[Second Revised Maximum Export Price Regulation]
[From the U.S. Government Publishing Office, www.gpo.gov]

Issued by the Office of Export-Import Price Control OFFICE OF PRICE ADMINISTRATION
Second Revised Maximum Export Price Regulation
1.	Statement of Considerations
2.	The Regulation and. Amendments Nos. 1 and 2
3.	Questions and Answers
UNITED STATES OF AMERICA
OFFICE OF PRICE ADMINISTRATION
May 1943
UNITED STATES GOVERNMENT PRINTING OFFICE • WASHINGTON • 1943
OFFICE OF PRICE ADMINISTRATION
STATEMENT OF THE CONSIDERATIONS INVOLVED IN THE ISSUANCE OF THE SECOND REVISED MAXIMUM EXPORT PRICE REGULATION EXPORT PRICES
The Maximum Export Price Regulation was issued by the Office of Price Administration on April 25, 1942, in order to prevent excessive diversion of American goods to foreign markets which would have been encouraged by uncontrolled export prices and to extend to buyers abroad protection similar to that afforded to buyers in this country. This was accomplished by holding the exporter’s mark-up over maximum domestic prices or costs of acquisition of the commodities exported to the level prevailing in the periods, July 1 to December 31, 1940, or March 1 to April 15,1942, whichever was lower. The regulation was revised on July 2, 1942, to incorporate the amendments which had been issued up to that time and to effect additional changes.
Experience with the operation of the revised regulation and changes in the character of the export business have made advisable another revision of the export regulation in order to effect a more workable system of export price control.
The second Revised Maximum Export Price Regulation incorporates the amendments to the revised regulation, and puts into effect new provisions which have been found necessary by thè Office of Price Administration. Although in outline the regulation has remained as it was, several changes have been made to alleviate hardships resulting from its application, to broaden its scope, clarify its meaning, and to make it easier to administer.
These changes may be roughly divided into two categories: (1) Changes of substance which experience has shown to be justified; and (2) changes in such matters as procedure, definitions, etc., which have been found desirable.
Part I
The seven changes in substance which are made by the revised regulation are: (a) The inclusion of a new section which broadens the definition of an export sale to. include sales to procurement agencies of foreign governments and sales to procurement agencies^of the United States buying for the account of the Office of Lend-Lease Administration and which specifically defines the maximum export price which shall apply on sales to the-latter (section 1) ; (b) the addition of a provision relating to sales to exporters (section 2) ; (c) a modification of the rule relating to direct invoicing as heretofore embodied in Amendment 2 to the first Revised Maximum Export Price Regulation (section 13 (c) ) ; (d) a 25 percent increase in allowable premiums to
compensate exporters for the increase in their overhead expenses (section 4 (a)); (e),the inclusion of a provision which eliminates the need for referring to the second base period in fixing~the export premium for a commodity which was during that period subject to a specific price schedule or regulation which contained no express provision for export sales, or which expressly prohibited the charging of an export premium (section 4 (a)); (f) the adoption of a provision which exempts from the regulation a sale to a foreign purchaser by a seller in the continental United States of an imported commodity which is in transit through the United States (section 9 (d)); and (g) changes in the provisions relating to sales by foreign agents or subsidiaries of exporters (section 9 (g) (2).
(a)	Sales to government procurement agencies (section 1). Under a ruling of the Office of Price Administration on June 16,1942, sales to procurement agencies of the United States and of other governments, which take title and all responsibility for the material at the factory door or at the shipping dock, were classified as domestic sales. This ruljng meant that sellers making such sales could be compensated for export packing costs, installation and servicing abroad, foreign selling expenses, etc., only to the extent to which compensation was permitted under the applicable domestic schedule or regulation.
It soon became evident that sellers to such agencies were being denied adequate compensation for export packaging costs and other legitimate export functions in many cases where domestic ceilings did not adequately allow for such compensation.
On October 23, 1942, therefore, a press release was issued declaring that it was the fundamental export policy of the Office of Price Administration to allow compensation for export functions actually performed. Sales to procurement agencies of the United States, purchasing for the account of lend lease, were to be handled as before under the individual commodity price regulations and the General Maximum Price Regulation. However, provisions were to be written into those schedules and regulations to permit the seller to receive compensation for certain export expenses which would not be involved in an ordinary domestic sale.
This piecemeal approach to the problem did not yield results. The Office of Price Administration has, therefore, decided to place sales to procurement agencies of both the United States and foreign governments in the category of
export sales, thus entitling the seller to receive compensation, over and above the domestic ceilings, for export functions actually performed.
Sales to procurement agencies of foreign governments are now to be classified as ordinary export sales. The seller’s maximum price is to be determined in accordance with the general provisions of the second Revised Maximum Export Price Regulation.
Sales to procurement agencies of the United States buying for the account of lend lease, on the other hand, are to be treated somewhat differently. The seller is required to use as his basic price the maximum domestic price established for such transactions by the applicable domestic schedule or regulation. To this basic price he is permitted to add only the extra packing costs permitted by Supplementary Order No. 34—issued on December 21, 1942, to simplify the purchasing problems of the armed forces— and the difference between the greater cost of installation or other necessary services involved in the sale and the cost of installation or other necessary services which would have been involved in a comparable domestic sale, when such installation or services are procured by an agency of the United States. The seller is not entitled to the export premium permitted by section 4 (a) on other export sales, and he is not permitted to add to his domestic ceiling price any of the allowable expenses referred to in section 4 (b), except packing.
The justification for this difference in the treatment of sales to domestic and foreign procurement agencies is that frequently a foreign procurement agency which places an order direct with a seller in the United States is purchasing for the account of a private consumer abroad. Such sales are essentially private transactions. In most instances they result from the efforts of the seller’s agent or branch house abroad. Since such sales are like everyday export sales except for the formal placing of the order, it seems fair to permit the seller to charge a premium and to recover the allowable expenses to which he would be entitled on an ordinary export sale.
Sales to procurement agencies which purchase for the account of lend lease, on the other hand, are not so frequently of a private character. While it is true that the commercial requirements of foreign purchasers are being met to some extent through lend-lease purchases, the bulk of the commodities purchased for the account of lend lease are ordered for the use of a foreign government. It
(1)
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has, therefore, been thought desirable to limit the seller to a minimum amount of compensation over and above his basic price, for export functions performed.
No extra compensation is permitted on lend-lease sales for services performed in the past, but only for those being performed in conjunction with the particular sale.
Payment of extra compensation is permissive and must be justified to the satisfaction of the procurement agency involved. The amount of compensation which the supplier receives will depend on the terms of the contract which he negotiates with the procurement agency. It will be limited to payment for installation, engineering, and other necessary work performed by the seller or his representative. It is, of course, understood that insofar as the domestic ceiling price is adequate to cover the cost of extra export packing, installation, and other necessary services, additional compensation will not be paid. It is also understood that when payment for these functions is made by a foreign government in its own currency, the payment at home will be reduced correspondingly.
(b)	Sales to exporters (section 2). Sales to export merchants or to other bffyers in the continental United States of commodities intended for shipment abroad have hitherto been treated like ordinary domestic sales. Suppliers have complained that there are certain expenses associated with such sales which are not involved in other domestic sales and for which no provision is made in most of the domestic schedules ‘and regulations. A new provision has, therefore, been included in the regulation to permit a person selling to an exporter to add to his domestic ceiling price the cost of extra export packing and the extra cost of installation and servicing abroad. If the applicable domestic schedule or regulation makes specific provision for such expenses, that provision will control.
Sales to exporters are not defined as export sales.
(c)	Direct invoicing (section 13 (c) ). Amendment No. 2 to the first Revised Regulation prohibited an exporter from invoicing direct to a customer of his foreign buyer at a price in excess of his maximum export price to his own buyer. While experience has confirmed the wisdom of placing a limitation upon the practice of direct invoicing, it has also indicated that some relaxation of the present rule is desirable. By billing direct to the consumer, the exporter is frequently able to minimize his credit risk and to maintain some check on his distributor’s resale prices. Where the consumer is a governmental agency or public institution, direct invoicing may make payment of duties and port fees in the foreign country unnecessary. The direct • invoicing provision has been a customer of his foreign buyer at the same price which he could charge such a buyer on a direct sale.
It is believed that this change will result in placing American goods in the hands of users abroad at more reasonable prices than would be otherwise possible. Since the exporter may now
invoice the customer of his distributor at his export ceiling price to the customer, the distributor may now realize his resale profit out of the difference between the exporter's maximum price to him and the exporter’s maximum price to the consumer. A foreign distributor who desires to have the merchandise billed from his supplier to his customer will be held to this margin in lieu of a greater margin which might be obtainable if the merchandise were invoiced to him and reinvoiced by him to his own customer.
(d)	Adjustment of premium (section 4 (a)). Since the regulation defines the allowable premium as the average premium which was charged in the trade during the two base periods, July 1 to December 31, 1940, or March 1 to April 15, 1942, whichever was lower, exporters are required, in the great majority of cases, to use the 1940 base period premiums. Many exporters have complained that the increase in their overhead expenses since the July 1 to December 31,1940, base period has made it impossible for them to operate profitably on the basis of the customary premiums which were charged in the trade during that period. Mail, cable, and telephone expenses have increased greatly due to the greater use of air mail, the greater number of cables per transaction, and the fact that code can no longer be used in sending cables. Clerical expenses have risen because of the increase in the amount of clerical work associated with the conduct of the export business. Higher rents in export centers have contributed to the increase in exporters’ expenses. Financing costs have increased due to longer tie-up of funds, larger capital needed because of increased shipping expenses, and the necessity of borrowing from credit companies at higher rates. The expenses of traveling representatives have likewise risen, due to the necessity of travel by air and the increased cost of living in foreign countries. Some increase in allowable export premiums to compensate for these higher costs has, therefore, seemed necessary if our export machinery is to be preserved during the war period.
The Office of Price Administration has recently made a study of exporters’ overhead expenses with a view to determining the average percentage increase in such costs since the end of 1940. The results of this study have indicated that most components of the exporters’ overhead costs have increased considerably since that period. From the estimates of the changes in the various items, a figure was constructed for changes in total overhead costs. The weighted average increase was found to be between 23 and 26 percent. This figure does not take into consideration the increase in unit overhead due to declining volume.
On the basis of this study, it was decided to make an adjustment of allowable premiums to compensate exporters for this estimated increase in their total overhead expenses since the first base period. The premium provision has, therefore, been changed to allow the exporter to charge a premium which does not exceed 125 percent of the July 1 to December 31, 1940, average premium or 125 percent of the March 1 to April 15,
1942, average premium, whichever is lower.
While the adjustment is intended primarily to benefit those exporters who are required to use the first base period premium, it is made applicable to the second base period premiums also, in order to avoid penalizing those exporters who either lowered or did not increase their premiums after 1940.
(e)	Elimination of second base period premium for certain commodities. (Section 4 (a)). During the 1942 base period price schedules and regulations were in effect which for want of expression of a contrary intent, were construed to cover export sales even though they contained no specific export provision. No export premium, as a consequence, was available on export sales of commodities subject to such regulations, since the domestic price was held to be the price for both domestic and export sales during the 1942 base period and all export sales were made on that basis. An investigation of this situation has revealed that the failure to make express provision for export sales was in many instances due to oversight, and that the failure to allow a premium was contrary to customary practice in the export trade. A number of individual schedules and regulations were also in effect during the March 1 to April 15, 1942, period, which, while making provision for export sales, expressly prohibited the charging of an export premium. Here, too, it is apparent that export problems had frequently been ignored, and that the denial of a premium was not in conformity with the past practice of exporters of the commodity concerned. The Office of Price Administration has, therefore, decided to eliminate the second base period in all such cases, and to permit the exporter to use 125 percent of the average premium which was charged in the trade during the first base period. In this manner, pricing policies of exporters are more securely founded on customary trade practice, and the export of many commodities is made possible which could otherwise be effected only at a loss to the exporters.
(f)	In transit shipments (section ‘9 (d)). A new provision has been inserted to exempt from the regulation export sales of imported commodities which are shipped into the United States for transshipment in bond. An export sale of an imported commodity is, therefore, no longer subject to the Regulation if the commodity was entered in the first instance at the customs either for Immediate Exportation or for Transportation and Exportation ancTif it remains under such entry at the time of exportation. Commodities which are imported under either of these two forms of entry are intended for reexport and do not enter into the domestic commerce of this country. The problem of diversion of domestic supplies to foreign markets, which is a main consideration of export price control, is, therefore, not presented.
An imported commodity which is brought in under a Warehouse Entry and subsequently withdrawn for exportation would not be entitled to the benefit of the exemption, since it cannot be considered
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to be in transit through the United States.
Another new provision exempts from the regulation goods which are sold while stored in a free port established by the laws of the United States.
(g)	Sales by foreign agents or subsidiaries of exporters (section 9 (g) (3). The provisions relating to sales by a foreign agent or subsidiary of the exporter have been changed to exempt from the regulation a sale by the agent or subsidiary of a manufacturer or producer in certain countries in the British Empire. Since these countries have adequate systems of domestic price control, it has been thought unnecessary to attempt to regulate the selling prices of such agents and subsidiaries therein through the medium of the Export Price Regulation.
'I’he selling price from the principal company to an agent or firm controlled abroad remains subject to the second Revised Maximum Export Price Regulation.
Part II
Other changes which have been made in the Revised Maximum Export Price Regulation are less substantial in character. These changes have been made to clarify the Regulation and to adjust minor difficulties and inequities.
Section 3 (b) formerly required a manufacturing exporter to use as his basic price the highest price at which a commodity was sold domestically to a similar purchaser on the date the contract of the export sale was made, if no domestic ceiling price existed for the same or most nearly similar commodity. Since the Regulation now does not apply to an export sale of any commodity for which no domestic ceiling has been established, this provision is unnecessary. It has, therefore, been eliminated.
Several changes have been made in section 3 (c) of the regulation. First, the word “comparable” in that section has been changed to “similar” in order to bring the language into conformity with that of section 3 (b). Second, the section has been changed to extend the method of pricing provided for there to a commodity which, while sold domestically, is not sold domestically to the same class of trade to which the foreign purchaser belongs. Third, if the exporter made no export sales of the commodity during the March 1 to April 15, 1942, period, he is now permitted to charge the same price which he charged on the last export sale of the commodity which he made to the same or a similar foreign purchaser prior to that date. Fourth, the twenty-day waiting period after the filing of the affidavit has been eliminated. Finally, the Price Administrator is empowered to adjust or disapprove the proposed prices if in his opinion such prices are excessive, as well as on the ground that the requirements of the section are not met.
A modification has also been made in section 3 (d), relating to export sales of bituminous coal, to provide that the maximum domestic price shall be determined in accordance with the applicable domestic price regulation when the sale is made on a prepared size basis.
A slight change has been made in the provision of section 4 (a) regarding differentials in the base period premium, to embody an interpretation already placed upon the regulation, namely, that in determining the applicable premium, due recognition is to be given to variations in the base period premium according to the credit terms extended. Recognition is also to be given to the functions performed by agents or subsidiaries abroad. It is thus made clear that in computing the applicable base period premium on export sales by agents or controlled firms, exporters may refer to the combined premium charged on similar exports by exporters and their foreign subsidiaries, branch houses or other controlled agents.
Section 4 (b) has been clarified by stating in greater detail a number of extra allowable expense items which the exporter may add to his basic price.
The last sentence of section 4 (b) has been replaced with a provision which more clearly states the policy of the Office with respect to the addition of inland freight to the basic price. Where the exporter uses as his basic price his domestic ceiling price and such ceiling price is a delivered price, his basic price is the delivered price at the port of exit. Under present shipping conditions, however, the exporter is frequently obliged to ship from an emergency port which is outside his normal market area, so that the amount incurred for inland transportation is in excess of the amount which he would normally incur on either domestic or export sales. In order to mitigate the hardship which results in these situations, the exporter is permitted to use as his basic price, in lieu of his domestic ceiling price at the emergency port, his domestic ceiling price at his normal port of exit and to add to this basic price the difference between the freight actually incurred to the emergency port and the freight which would have been incurred had he used the normal port. A similar provision is included to take care of situations where the exporter’s maximum domestic price is established on an f. o. b. basis with all or part of the freight allowed.
Section 5, relating to draw-backs, has been clarified to provide specifically that a draw-back received by the exporter is to be considered a part of his premium and that such draw-back may be retained by him only to the extent that it does not increase his premium beyond the maximum permitted by 4 (a). There is thus written into the .new Revised Regulation an interpretation which has been applied since the issuance of the original export price regulation.
In section 7 (a), relating to textiles, the definition of the goods affected has been broadened to include twisted goods, as well as woven or knitted.
The provision relating to sales by foreign agents or subsidiaries of exporters has been reworded in order to make it clear that exporter’s selling price to the agent or subsidiary, as well as the resale price charged by the latter, is controlled by the Regulation.
The definition of an “export sale,” as set forth in section 11 has been changed so as to make it clear that, the term in
cludes any sale to an agent in the United States who discloses that he takes title on behalf of a foreign purchaser. The status of sales to purchasing agents or branch houses of foreign importers, or to export commission houses which act as agents for such importers, is thus clarified. Specific provision is made that where such a buyer reveals to the seller that he takes title on behalf of the foreign purchaser and the seller charges a price above the domestic ceiling, such disclosure must be noted on the seller’s invoice.
Some further changes have been made in the definition of an “export sale.” The requirement that the commodity be physically located in the continental United States at the time of sale has been eliminated. It is now only necessary that the commodity is, or has been, transported from the continental United States to a point outside thereof. The requirement that the sale be made by a seller in the continental United States has also been eliminated, in order to make it clear that a sale by a seller outside the United States is governed by the regulation if the selling or invoicing is done here.
The definition of an “exporter” has been clarified to include any individual, etc., participating as seller or seller’s agent in any selling or invoicing in connection with an export sale.
A provision has been added in section 9 which exempts from the regulation export sales by the United States Commercial Co. in conjunction with preclusive buying arrangements entered into by that agency. Such exports are not ordinary commercial transactions but are part of quasi-barter arrangements whereby the United States Commercial Co. exports merchandise from this country in partial consideration for preclusive purchases. Furthermore, the prices received by the United States Commercial Co. for such exports constitute one of the. principal means of obtaining foreign exchange for making further preclusive purchases. It is apparent, therefore, that the prices received by that agency for its exports should not be limited by the price regulations applicable to normal commercial exports.
A new provision has been included which permits an exporter who pays a commission to his foreign customer’s buying agent in the United States on such customer’s behalf to include the amount of such commission on his invoice, in addition to his export ceiling price. Such commission must be separately stated on the invoice rendered to the customer.
A provision has been inserted in the regulation to permit the filing of a petition for adjustment by any person on whom any provision of the regulation imposes excessive hardship.
A minor change has been made in the provisions of section 11, relating to records, to provide for the filing by exporters of price information in any manner which may be prescribed by the Office of Price Administration or the Board of Economic Warfare.
Issued this 30th day of March 1943.
Prentiss M. Brown,
Administrator.
2d Rev. Max. Export Price Reg.
March 30, 1943
OFFICE OF PRICE ADMINISTRATION
Part 1375—Export Prices
Document No. 13066
[2d Rev. Max. Export Price Reg.]
Revised Maximum Export Price Regulation is amended to read as follows:
A statement of the considerations involved in the issuance of this regulation has been issued simultaneously herewith and has been filed with the Division of the Federal Register.
§ 1375.1	Maximum export prices. Under the authority vested in the Price Administrator by the Emergency Price Control Act of 1942 as amended, and Executive Order 9250, the Second Revised Maximum Export Price Regulation which is annexed hereto and made a part hereof, is hereby issued.
Authority: § 1875.1 issued under Pub. Laws 421 and 729, 77th Cong.; E.O. 9250, 7 F.R. 7871.
Second Revised Maximum Export Price Regulation
contents
Sec.
1	Export sales to procurement agencies of the United States for the account of the Office of Lend-Lease Administration.
2	Sales to exporters.
3	Maximum export prices for export sales, other than for the account of the Office of Lend-Lease Administration.
4	Export premiums and allowable expenses on export sales other than for the account of the Office of Lend-Lease Administration.
5	Deductions from maximum export prices on export sales other than for the account of the Office of Lend-Lease Administration.
6	Promulgation of specific maximum export premiums for export sales other than for the account of the Office of Lend-Lease Administration.
7	Specific maximum export premiums for export sales other than for the account of the Office of Lend-Lease Administration.
8	Export prices for iron and steel products subject to Revised Price Schedule 6 or Revised Price Schedule 49 in the domestic market.
9	Exceptions.
10	Records.
11	Definitions.
12	Adjustments.
13	Enforcement.
14	Existing maximum price schedules, regulations or orders.
15	Effective date.
Section 1 Export sales to procurement agencies of the United States for the account of the Office of Lend-Lease Administration. On a sale to a procurement agency buying for the account of the Office of Lend-Lease Administra
tion, established under the terms of the Act of March 11, 1941, entitled “An Act to Promote the Defense of the United States,” the maximum price shall be the seller’s maximum domestic price applicable to the transaction plus the following charges if separately shown on the seller’s invoice:
(a)	Extra packing costs to be determined in accordance with Supplementary Order No. 34’ issued by the Office of Price Administration;
(b)	The difference between the greater cost of installation and other necessary services involved in the sale and the cost of installation and other necessary services which would have been involved in a domestic sale, if such installation or services are contracted for by an agency of the United States, whether such installation or services are performed directly by the seller or by his distributor or agent:
Except that if the applicable domestic price regulation expressly allows and provides for any of the expenses on sales for the account of the Office of Lend-Lease Administration, that provision of the domestic price regulation shall govern.
Sec. 2 Sales to exporters. On a sale to a person who buys for his own account a commodity for shipment outside the continental United States, the maximum price shall be the seller’s maximum domestic price applicable to the transaction plus the following charges if separately shown on the seller’s invoice:
(a)	Extra packing expenses as allowed by section 4 (b) ; and
(b)	The difference between the greater cost of installation and servicing involved in the sale and the cost of installation and servicing involved in a comparable domestic sale, whether such installation or servicing is performed directly or by a distributor or agent:
Except that if the applicable domestic price regulation expressly provides for installation and servicing on such sales, that provision of the domestic price regulation shall govern.
Sec. 3. Maximum export prices for export sales other than to procurement agencies of the United States for the account of the! Office of Lend-Lease Administration. On and after April 5, 1943, regardless of the terms of any contract of sale or purchase, or of any export license thereafter issued by the Board of Economic Warfare or other governmen-
17 F.H. 10779.
tai agency, no exporter or other seller in a transaction dealt with below shall sell, offer to sell, transport, ship, or participate in the transportation or shipment of, any commodity at a price in excess of the following maximum prices:
(a)	In the case of an exporter other than the manufacturer or producer of the commodity the maximum export price shall be either:
(1)	The price at which the commodity was acquired or the maximum domestic price which would be applicable to a current sale of the commodity to the exporter by the supplier thereof, plus the additions thereto authorized by paragraphs (a) and (b) of section 4 and less the deductions provided by section 5 (a); or
(2)	The maximum domestic price, at the point from which the commodity is to be shipped for export, which would be applicable to'a sale of the commodity by the exporter to a domestic purchaser similar to the purchaser outside the Continental United States, plus the allowable expenses authorized by section 4 (b) , and less the deductions provided by section 5 (a). In the event that a maximum domestic price for such a sale of the commodity by the exporter is not determinable, a price in line with the maximum undelivered price which would be applicable to such a sale by the domestic jobber or wholesaler located nearest the point from which the commodity is to be shipped for export may be substituted as the basic price and the addition of allowable expenses authorized by section 4 (b) and the deductions provided by section 5 (a) made thereto: Provided, That on an export sale of the goods dealt with in section 7, a premium not in excess of that specified therein may be added.
(b)	In the case of an exporter who is the manufacturer or producer of the commodity to be exported, the maximum export price shall be his maximum domestic price for the commodity to a domestic purchaser similar to the purchaser outside the continental United States or, in case there is no such price, shall be his maximum domestic price to such a similar purchaser for the most nearly similar commodity of equal or lower quality or grade plus the additions thereto authorized by sections 4 (a) or 7, and 4 (b>, and less the deductions provided by section 5 (b).
(c)	In the case of an exporter who is the manufacturer or producer of a commodity which is not sold domestically by any seller and for which there is no similar domestic product, or which is not
(4)
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sold domestically by any manufacturer or producer to the class of purchaser to which the exporter sells outside the continental United States, the maximum export price shall be the highest price charged in the export market by the manufacturer or producer to the same purchaser or to a similar purchaser outside the continental .United States during the period March 1 to April 15, 1942, or the price on the last sale of the commodity by the exporter to such a purchaser prior to that period. No such price shall be charged until after an affidavit has been filed with the Office of Export-Import Price Control, Office of Price Administration, Washington, D. C., stating either that no similar product sold in the domestic market exists, or that no similar product is sold domestically by ahy manufacturer or producer of the product to a purchaser of the same class as the purchaser outside the continental United States; showing the maximum export price proposed to be charged on export sales of the commodity, and indicating the transaction or transactions in the March 1 to April 15, 1942 period or prior to that period upon which the proposed price is based. The Price Administrator may disapprove or adjust the prices proposed if in his opinion the requirements of this section are not met, or if in his opinion the price is excessive.
(d)	In the case of solid fuels exported to the Territories of Alaska and Hawaii, the Dominion of Cana,da and Newfoundland, the maximum export price shall ube that established by Maximum Price Regulations Nos. 120, 121, and 122 to the extent that such regulations are applicable.
In calculating the maximum export price on sales of bituminous coal to all other destinations, the maximum domestic price to be used shall be the maximum price for the same coal at the port of embarkation, determined by the seller under Maximum Price Regulation No. 189, unless the sale shall have been made on a prepared size basis, in which event the maximum domestic price shall be determined in accordance with the applicable domestic price regulation.
Sec. 4 Export premiums and allowable expenses on export sales other than to procurement agencies of the United States for the account of the Office of Lend-Lease Administration, (a) An amount (stated either as a percentage of the basic price or as a flat amount, depending upon the customary practise in the trade) not in excess of 125 per cent of the avérage premium charged in the export trade during the period July 1 to December 31, 1940 for the particular services or functions performed, or 125% of the average premium charged in the export trade during the period Inarch 1 to April 15,1942, for the particular services or functions performed, whichever’ figure is the lower, may be added by the exporter to his maximum domestic price or other basic price, as provided in section 3 of this regulation. If the commodity being exported was, during the period March 1 to April 15,1942, covered by a specific price schedule or regulation which contained no express provision for
export sales or which expressly prohibited the charging of an export premium, the maximum premium shall be 125 per cent of the average premium charged during the period July 1 to December 31, 1940. In determining the applicable premium, due recognition shall be given to differences in the amount of the premium charged by different types of exporters during the controlling base period, and to differences in premiums resulting from variations in the size or value of exports, the terms of credit, the destination of the goods, and the functions performed by agents or subsidiaries at the destination: Provided, That no premium may be included in a maximum export price'computed under section 3 (a) (2) unless otherwise provided for therein, or under section 3 (c): Provided further. That the applicable average export premium shall not be increased by reason of the fact that more than one exporter participates in the process of exportation.
(b)	An amount may be added by the exporter to his basic price to compensate for expenses, such as freight, marine and war risk insurance, consular fees, freight forwarders’ fees, packing costs in excess of those incurred on domestic sales, demurrage charges, and other shipping charges, incident to exporting the commodity and incurred or to be incurred by the exporter. When the maximum domestic price which is used by the exporter as his basic price under sections 3 (a) (2) or 3 (b) is a delivered price and the exporter uses an emergency port of exit, he may add to the maximum delivered price at the normal port of exit the difference between the inland freight actually incurred to the emergency port and the freight which would have been incurred had a normal port of exit been used. When the maximum domestic price which is used by the exporter as his basic price under sections 3 (a) (2) or 3 (b) is established f. o. b. interior shipping point with an allowance of all or part of the inland freight and the exporter uses an emergency port of exit, he may add to such basic price the inland freight actually incurred to the emergency port less the amount of freight which he would be required to allow on shipments to the normal port.
Sec. 5 Deductions from' maximum export price on export sales other than to procurement agencies for the account of the Office of Lend-Lease Administration. (a) Where an exporter other than the manufacturer or producer of the commodity is entitled and lays claim to any drawback of import duties or excise taxes or export subsidy the amount of such drawback or such subsidy, with allowance for the expenses incurred in obtaining such drawback or subsidy, shall be deemed an addition to the price charged by the exporter and may only be retained by him provided that it does not increase his premium beyond the amount allowed by sections 4 (a) or 7 of this regulation.
(b)	Where an exporter who is the manufacturer or producer of the commodity is entitled and lays claim to any drawback of import duties or excise taxes or export subsidy the amount of such
drawback or subsidy, with allowance for the expenses incurred in obtaining such drawback or subsidy, shall be deemed an addition to the price charged by the exporter to the extent to which his cost of manufacture of the commodity is reduced below the cost of manufacture of the same or similar commodity sold domestically. This addition may be retained to the extent that it does not increase his premium beyond the amount allowed by sections 4 (a) or 7 of this regulation.
Sec. 6 Promulgation of specific maximum export premiums for export sales other than to procurement agencies for the account of the Office of Lend-Lease Administration. The Office of Price Administration may from time to time promulgate figures which shall reflect the average premium charged in the export trade for the particular services or functions performed during either the period July 1 to December 31, 1940 or March 1 to April 15, 1942, whichever average premium is lower.
Moreover, if the periods July 1 to December 31, 1940 or March 1 to April 15, 1942 are determined by the Price Administrator to be inappropriate base periods, or where the trade or industry finds great difficulty in discovering an appropriate premium in the base periods the Office of Price Administration may promulgate a specific export premium for the trade or industry. In case of such promulgation, and pursuant to and subject to the terms of the promulgation, the premium therein stated shall become the maximum premium to be charged in the export trade unless the alternative of the average export premium of the trade is specifically allowed by the Administrator. Such promulgation or promulgations shall be in the form of amendments to this Maximum Export Price Regulation, and shall be inserted as subparagraphs of section 7.
Sec. 7 Specific maximum export pre- a miums for export sales other than to procurement agencies for the account of the Office of Lend-Lease Administra- > ; tion—(a) Textiles. The maximum ex-f n port premium to be charged on an export! £ sale of textiles, whether woven, twisted,; & or knitted, containing 75 per cent or' ( more by weight of cotton or artificial fiber, or a mixture of cotton and artificial^ fiber, including but not limited to fin-gg ished piece goods and grey goods re-^g gardless of width, and articles which are^»-transformed from piece goods into fin-^g ished articles simply by cutting and/or^ hemming and/or overedging (but not in-* ' eluding wearing apparel), and yarn, ’; thread, twine and rope of cotton or arti- \ ficial fiber, shall be either:1'
(1)	An amount as defined in section , 4 (a), which may be added to the basic ; price as defined in sections 3 (a) (1) or \ 3 (b); or	V
(2)	An amount not in excess of 7 per | cent of the domestic maximum price I which is applicable to a sale by the exporter to a domestic purchaser similar, to the purchaser located outside the con-: tinental United States, which may be added to the basic price as defined in sections 3 (a) (2) or 3 (b).
6
(b)	Domestic chrome ores and concentrates. The maximum export premium to be charged on an export sale oF domestic chrome ores and concentrates of 38% to 44% to Cr2Os content shall be $6.00 per gross ton of 2,240 pounds.
(c)	Bituminous coal. The maximum export premium to be charged on an export sale of bituminous coal, except to the Territories of Alaska and Hawaii, the Dominion of Canada and Newfoundland, shall be 25 cents per net ton of 2,000 pounds.
Sec. 8 Export prices for iron and steel products subject to Revised Price Schedule 6 or Revised Price Schedule 49 in the domestic market, (a) In the case of an exporter who is a producer of iron and steel products as defined in Revised Price Schedule No. 6 (Iron and Steel Products), the maximum export price of such a product sold under a contract of sale entered into on or after April 2,1943 shall be either:
(1)	The aggregate of:
(i)	The domestic or export base price of the product at the governing or emergency basing point, plus applicable domestic and export extras, as provided in Revised Price Schedule No. 6, and plus inland transportation charges (at export rates where applicable) from such governing or emergency basing point (whichever is applicable) to the port of exit: Provided, however, That if an emergency basing point is used the transportation charges shall in no case exceed the actual transportation charges from the producing mill to the port of exit; and
(ii)	Expenses Incident to exportation and incurred or to be incurred by the exporter such as demurrage, storage, transfer to the export carrier, ocean or other export freight, marine and war risk insurance, and consular fees; or .
(2)	The aggregate of:
(i)	The export base price of the product quoted by the United States Steel Export Company f. a. s. the port of exit on April 16, 1941, plus applicable export extras, as provided in Revised Price Schedule No. 6 (see its appendix D for such export base prices for principal ports); and
(ii)	Expenses incident to exportation and incurred or to be incurred by the exporter for demurrage, storage and transfer to the export carrier, in excess of the amounts of such charges which were normally included in the price under section 8 (a) (2) (i) above; and
(iii)	Other expenses incident to exportation and incurred or to be incurred by the exporter such as ocean freight, marine and war risk insurance, and consular fees; or
(3)	Where a product has no basing point base price, the maximum price established by section 8 (a) (2) above, or the aggregate of:
(i)	The export price, including applicable extras, which was or would have been charged for the product by the producer on April 16, 1941, plus inland transportation charges (at export rates where applicable) from the producing mill to the port of exit (except that portion of those charges which was or would have been included in such price; and
(ii)	Expenses incident to exportation and incurred or to be incurred by the
exporter in excess of the amounts, if any, of such expenses which were normally included in the price under section 8 (a) (3) (i) above.
Provided, That on a sale to a procurement agency buying for the account of the Office of Lend-Lease Administration, the maximum price shall be the maximum domestic price established by Revised Price Schedule No. 6, except that (a) where there are no published or filed domestic extras, export extras shall apply; (b) inland transportation charges shall be computed at export rates where applicable, otherwise at domestic rates; and (c) where there is no established domestic ceiling price for the product, the maximum price shall be determined in accordance with the provisions of sections 8 (a) (2) or 8 (a) (3) above.
(b)	In the case of an exporter who is not a producer but a seller of iron and steel products as defined in Revised Price Schedule No. 49,s the maximum export price of such a product sold under a contract of sale entered into on or after April 2, 1943 shall be either:
(1)	Where the exporter has put the product being exported through “the operations commonly known as the warehousing of iron or steel products” as defined in § 1306.157 (s) of Revised Price Schedule No. 49, the aggregate of:.
(i)	The maximum price, including applicable extras, as provided in Revised Price Schedule No. 49 which would be applicable to a sale of the product by the exporter to a domestic purchaser within the exporter’s city or free delivery area (which price shall include delivery f. o. b. inland carrier within such city or free delivery area or, if shipment is to be made by boat from port located within such city or free delivery area, shall include delivery f. a. s. vessel);
(ii)	Expenses incident to exportation and incurred or to be incurred by the exporter, such as inland transportation charges (at export rates where applicable), demurrage, storage, transfer to the export carrier, ocean or other export freight, marine and war risk insurance, and consular fees; or
(2)	Where the exporter has not put the product being exported through “the operations commonly known as the warehousing of iron or steel products” as defined in ^1306.157 (s) of Revised Price Schedule No. 49, the aggregate of I
(i)	The maximum price, including applicable extras, which would be applicable to a current sale of the product to the exporter by the supplier thereof; and
(ii)	An amount not in excess of 12y2 per cent of such maximum price (but which need not be less than $20) when the total price of the order to the exporter computed at such maximum price does not exceed $1,000, or 10 per cent (but not less than $125) when such total price is over $1,000 but does not exceed $4,000, or 8 per cent (but not less than $400) when such total price is over $4,000 but does not exceed $10,000, or 6 per cent (but not less than $80Q) when such total price is over $10,000; and
a7	F.B. 1300, 2132, 2473, 2540, 2682, 3330, 3893, 4342, 5176, 6893, 6935, 8948, 10844; 8 F.R. 319, 1583, 2388.
(ill)	An additional amount calculated as a percentage of the maximum price under section 8 (b) (2) (i) above, aS follows; if the terms of payment call for letter of credit payable against ocean documents, 1% percent; or, if the terms call for draft payable abroad and no letter of credit is involved, 2 percent if such draft is payable at sight plus an additional & of 1 per cent for each 30 days from sight at which such draft is payable; or, if the sale is made on open account, 2 per cent if the terms stated are cash on receipt of invoice, plus an additional of 1 per cent for • each 30 days of credit extension stipulated on the invoice, but in no event more than a total of 3^ per cent; and
(iv) Expenses incident to exportation and incurred or to be incurred by the exporter, such as inland transportation charges (at export rates where applicable), demurrage, storage, transfer to the export carrier, ocean or other export freight, marine and war risk insurance, and consular fees.
(c)	Where shipment has actually been made to the intended point of exportation and war exigencies require the use of another point of exportation, the maximum export prices shall be those established under- sections 8 (a) and. 8 (b) above, except that such maximum prices may include the additional amount actually incurred by the exporter to effect delivery at the point of exportation finally used.
(d)	The maximum export prices established by sections 8 (a) and 8 (b) above shall include and shall not be increased by reason of interest or financing charges connected with the transaction or by reason of any fees or commissions, including commissions paid to intermediaries, whether domestic or foreign.
Sec. 9 Exceptions, (a) The provisions of this Maximum Export Price Regulation shall not be applicable to any export made pursuant to a contract of sale entered into prior to April 30, 1942 for which an export license is not required or which is made under a validly outstanding export license issued by the Board of Economic Warfare or the Department of State prior to April 30,1942: Provided, That the exception here granted shall apply to exports for which an export license is not required or which are made under general or unlimited licenses issued by the Board of Economic Warfare only if the commodity was actually transported outside of the continental United States prior to October 1, 1942.
(b)	The Administrator, subject to such terms and conditions, as he shall determine to be necessary or desirable, may grant an exception to the provisions of this Maximum Export Price Regulation in any case in which a certificate is received by the Administrator from the Board of Economic Warfare certifying that such exception is necessary for considerations of political or military necessity or because of the requirements of economic warfare.
(c)	The provisions of this regulation shall not be applicable to any export under a contract of sale entered into prior
7
to April 30, 1942, the price for which was determined under the export provisions of a specific price schedule or regulation issued by the Office of Price Administration prior to April 25, 1942.
(d)	The provisions of this regulation shall not apply to commodities shipped into the continental United States from outside thereof for »transshipment, in bond, to any destination outside the continental United States.
(e)	The provisions of this regulation shall not be applicable to goods sold while stored in a free port established by the laws of the United States.
(f)	The provisions of this regulation shall not be applicable to the export sale of a commodity which would not be governed by a domestic price regulation if sold domestically by the exporter to a domestic purchaser of the same class as the foreign purchaser.
(g)	The provisions of this regulation shall not be applicable to sales or resales by an agent of the exporter or a firm owned or controlled by the exporter when the commodity has been sold or invoiced to such agent or firm at a price not in excess of the price permitted by this regulation, if .
(1)	The agent or the owned or controlled firm has processed, fabricated or otherwise substantially changed the form of the commodity exported; or
(2)	The sale by the agent or the owned or controlled firm is through a regularly established retail outlet owned or operated by the agent or subsidiary; or
(3)	The sale is made by an agent of a manufacturer or producer of the commodity, or by a firm controlled by the manufacturer or producer and is made in the United Kingdom, the Dominions of Australia, New Zealand, the Union of South Africa and Canada.
(h) The provisions of this regulation shall not be applicable to export sales by the United States Commercial Company made under a directive of the Board of Economic Warfare in connection with its preclusive buying program.
' Sec. 10. Records, (a) Each exporter, in connection with any export for which a specific export license is required either in the space provided under question 17 of the duplicate and triplicate copies of the export license application to be filed with the Office of Export Control, Board of Economic Warfare, or in the space provided in any' form of export license application hereafter promulgated, or in any other manner which the Office of Price Administration or the Board of Economic Warfare shall prescribe, shall state the following information:
(1)	In the case of an exporter other than the manufacturer, the price at which the commodity was acquired or other basic price (exclusive of any expenses incident to export), or in the case of the manufacturer, the maximum domestic price or other basic price to which the additions authorized by paragraphs - (a), and (b) of sections 4 or 7 are to be made, and
(2)	The amount of the premium to be added pursuant to sections 4 (a) or 7.
(b)	In addition, each exporter shall, for a period of not less than two years from the date of export, retain a record
of each export transaction which shall contain all the facts pertinent thereto, including:
(1)	(i) In the case of an export by a person other than the manufacturer, the price at which the commodity was acquired and name and address of the person from whom the cpmmodity was acquired, or other basic price authorized by section 3 (a).
(ii)	In the case of an export by a manufacturer or producer the maximum domestic price or other basic price authorized by paragraphs (b) and (c) of section 3.
(2)	The name and address of the importer to whom the export sale was made, and
(3)	The aggregate price charged, the amount of the premium added pursuant to section 4 (a) or 7 and the amount of each additional item of expense added pursuant to section 4 (b) together with a copy of the invoice, bill of lading or other statement rendered to the importer in connection with the export sale.
(c)	Such records shall be available for inspection by duly authorized representatives of the Office of Price Administration and the Administrator may require their submission for periodical inspection if he deems such inspection necessary or desirable.
Sec. 11 Definitions, (a) When used, in this maximum export price regulation the term:
(1)	“Export” or “export sale” means:
(i)	Any sale'“of a commodity by a seller or his agent in the continental United States to a purchaser outside thereof in which the selling or invoicing is done in the continental United States, or is done outside the continental United States on behalf of a principal or parent firm in the continental United States, and the commodity sold is or has been transported from the continental United States to a point outside thereof;
(ii)	Any sale to a procurement agency of the United States for the account of the Office of Lend-Lease Administration;
»(Ui) Any sale to an agency of a foreign government;
(iv)	Any sale to an agent in the “United States who discloses that he takes title on behalf of a principal outside the continental United States, provided such disclosure is noted by the seller on his invoice; and
(v)	Any sale of the exported commodity by an agent abroad of the exporter for the exporter’s account, or by a firm owned or controlled by the exporter, within a period of two years after thejdate of shipment of the commodity from the continental United States except as provided in section 9 (g).	.
(2)	“Exporter” means any individual, partnership, association or corporation, including a manufacturer, export agent, export merchant, or commission merchant, engaging or participating, as the seller or his agent in any selling or invoicing in connection with an export sale.
(3)	“Continental United States” means only the forty-eight States and the District of Columbia.
(4)	“Maximum domestic price” means the highest price at which the seller may, under any applicable price schedule, regulation or order issued by the Office of Price Administration, sell, offer to sell, deliver or transfer a particular commodity to a given class of purchaser within the continental United States.
(5)	“Exporter who is the manufacturer or producer” shall include wholly owned subsidiaries, related companies all of whose stock is owned by a common parent, and persons to whose specifications and under whose supervision products are manufactured by another, as well as the actual manufacturer or producer.
(6)	The term “domestic purchaser similar to the purchaser outside the continental United States” means a domestic purchaser of the same general class as the purchaser outside the continental United States, e. g., manufacturer, wholesaler, jobber, exclusive distributor, retailer, government agency, public institution, individual consumer, or other class of purchaser for which the seller hat an established price.
(7)	“Basic price” shall mean the cost of acquisition or other domestic price referred to in section 3 of this regulation.
(8)	“Similar commodities” shall have the meaning given it in § 1499.2 of the General Maximum Price Regulation.
(9)	“Normal port of exit” means the port of exit in the continental United States from which the commodity being exported would have customarily been shipped in export to a particular destination during the period July 1 to December 31, 1941.
(10)	“Emergency port” means the port from which the commodity being exported is actually shipped in export, when the “normal port of exit” is not available.
(b)	Unless the context otherwise requires, the definitions set forth in section 302 of the Emergency Price Control Act of 1942 shall apply to other terms used herein.
Sec. 12 Petitions for adjustment. Any person seeking an adjustment of any provision of this Second Revised Maximum Export Price Regulation may file a petition for adjustment in accordance with the provisions of Revised Procedural Regulation No. 1.’ -
Sec. 13 Enforcement, (a) Any person violating either directly or indirectly the provisions of this maximum export price regulation shall be subject to the civil and criminal penalties, civil enforcement actions, suits for treble damages or other enforcement procedures authorized by the Emergency Price Control Act of 1942.
(b Any person having evidence of any violation of this regulation or any maximum price schedule, regulation or order issued by the Office of Price Administration is urged to communicate with the nearest regional or field office of the Office of Price Administration or its principal office in Washington, D. C.
(c)	No exporter shall invoice goods, whether to his buyer or any other person
»	7 FJX. 8961; 8 F.R 3313.
530125°—13---2
8
at a price in excess of the maximum export pripe which he may charge that person under the terms of this regulation: Provided, That an exporter may include in his invoice to a purchaser outside the continental United States any purchasing commission which he paid to his buyer’s purchasing agent in the continental United States under specific instructions of the buyer: Provided, That such commission is separately stated on the invoice rendered to the buyer.
Sec. 14. Existing maximum price schedules, regulations or orders. No pro
vision of any maximum price schedule, regulation or order heretofore promulgated by the Office of Price Administration shall be deemed to authorize any action inconsistent with the provisions of this regulation and, to the extent that the provisions of any existing schedule, regulation or order are inconsistent or in conflict with the provisions of the Maximum Export Price Regulation, sucli provisions are hereby revoked and superseded.
Nothing in this regulation shall be construed as superseding any provision in
any schedule, regulation, or order issued by the Office of Price Administration which requires the filing or reporting of the prices charged on sales to procurement agencies buying for the account of the Office of Lend-Lease Administration.
Sec. 15 Effective date. This revised regulation shall become effective April 5, 1943.
Issued this 30th day of March 1943.
Prentiss M. Brown, Administrator.
v 2d Rev. Max. Export Price Reg'.
AMENDMENT 1 MAY 6, 1943
OFFICE OF PRICE ADMINISTRATION
(Document No. 15J59)
Part 1375—Export Prices
[2d Rev. Max. Export Price Reg.,1 Amendment 1]
FINISHED RICE
A statement of the considerations involved in the issuance of this amendment issued simultaneously herewith,
»8 F.R. 4132.
has been filed with the Division of the Federal Register.*
The 2d Revised Maximum Export Price Regulation is amended in the following respect:
Paragraph (d) is added to section 7, to read as follows:
(d)	The maximum export premium to be charged on an export sale of finished rice shall be an amount not in excess of 4 per cent of the maximum domestic
price figured on the f. o. b. basis under section 6 of the Revised Maximum Price Regulation No. l§0.
Amendment No. 1 shall become effective May 12, 1943.
(Pub. Laws 421 and 729, 77th Cong., E.O. 9250, 7 F.R. 7871)
Issued this 6th day of May 1943.
Prentiss M. Brown, Administrator.
2d Rev. Max. Export Price Reg.
AMENDMENT 2
JUNE 7, 1943
(Document No. 16904)
Part 1375—Export Prices
[2d Rev. Max. Export Price Reg., Arndt. 21]
MISCELLANEOUS AMENDMENTS
A statement of the considerations involved in the issuance of this amendment, issued simultaneously herewith, has been filed with the Division of the Federal Register.*
The 2d Revised Maximum Export Price Regulation is amended in the following respects:
1. Section 12 is amended to read as follows:
Sec. 12 Petitions for adjustment. Any person seeking an adjustment of a provision of the 2d Revised Maximum Export Price Regulation relating to sales to a procurement agency of the United States for the account of the Office of Lend-Lease Administration, may file a
»Copies may be obtained from the Office of Price Administration.
18 F.R. 4132, 5987.
petition for adjustment in accordance with provisions of Revised Procedural Regulation No. 6.
Any person seeking an adjustment of any other provision of this 2d Revised Maximum Export Price Regulation may file a petition for adjustment in accordance with provisions bf Revised Procedural Regulation No. 1.
,2. Section 14 is amended to read as follows:
Sec. 14 Existing maximum price schedules, regulations or orders. No provision of any maximum price schedule, regulations or order heretofore promulgated by the Office of Price Administration shall be deemed to authorize any action inconsistent with the provisions of this regulation and, to the extent that the provisions of any existing schedule, regulation or order are inconsistent or in conflict with the provisions of the Maximum Export Price Regulation, such provisions are hereby revoked and superseded.
Provided, however. That on sales in the territories and possessions of the
United States this 2d Revised Maximum Export Price Regulation shall not operate to permit maximum prices in excess of the maximum price regulation, price schedule, or order applicable to any sale in those territories or possessions to any purchaser within those territories or possessions.
Nothing in this regulation shall be construed as superseding any provision in any schedule, regulation, or order issued by the Office of Price Administration which requires the filing or reporting of the prices charged on sales to prócurement agencies buying for the account of the Office of Lend-Lease Administration.
This amendment shall become effective June 12, 1943.
(Pub. Laws 421 and 729, 77th Cong., E.O.
9250, 7 F.R. 7871F
Issued this 7th day of June 1943.
George J. Burke, Acting Administrator.
(9)
QUESTIONS AND ANSWERS
TABLE OF CONTENTS
Part I. Scope and Exemptions.
Part n. Definition of Export Sale. Part III. Maximum Export Price. Part IV. Basic Price.
Part V. The Export Premium. Part VI. Allowable Expenses. Part VII. Draw-backs and Subsidies. Part Vm. Sales by Foreign Agents or Controlled Firms.
Part IX. Sales to Private Exporters and to Government Procurement Agencies.
Part X. Export Licenses and Filing of Export Prices.
Part XI. Sales in the Territories and Possessions.
Part XII. Records.
Part I—Scope and Exemptions
1.	Q. What Is the, function of the Second Revised Maximum Export Price Regulation?
A. It fixes maximum prices for export sales-of all commodities. No exporter shall sell, offer to sell, transport, ship, or participate in the transportation or shipment of any commodity at a price which exceeds the maximum. The present revised regulation governs export sales on and after April 5, 1943, superseding the original Maximum Export Price Regulation, which became effective April 30, 1942, the first Revised Maximum Export Price Regulation, which became effective July 2, 1942, and the various amendments thereto.
2.	Q. Does the regulation apply to an export sale of a commodity which would not be governed by a domestic price regulation if sold domestically by the exporter to a domestic purchaser of the same class as the foreign purchaser?
A. No.
3.	Q. Does the regulation apply to ’ a sale of goods which have been imported from outside the continental United States?
A. Yes; unless the goods were shipped into the continental United States for transshipment in bond to a destination outside thereof, or unless the goods are sold while stored in a free port established by the laws of the United States.
4.	Q. When are imported goods deemed to have been “shipped into the continental United States for transshipment in bond”?
A. When they were entered in the first instance either for “Immediate Exportation” (I. E.) or for “Transportation and Exportation” (T. & E.) and still remain under such entry at the time of exportation. A sale of goods which have been placed under a Warehouse Entry and subsequently withdrawn for exportation would be subject to the regulation.
5.	Q. Is an export made pursuant to a contract of sale entered into prior ta April 30, 1942—the effective date of the
original regulation—subject to the 2d Revised Maximum Export Price Regulation?
A. The export is exempt from the regulation if (1) a specific export license was not required and the commodity was actually transported outside of the continental United States prior to October 1, 1942; or (2) if the shipment is made under a validly outstanding individual export license issued by the Board of Economic Warfare or the Department of Agriculture prior to April 30, 1942; or (3) if the price was determined under the export provisions of a specific price schedule or regulation issued by the Office of Price Administration prior to April 25, 1942.
6.	Q. In the event that a specific license, issued prior to April 30, 1942, has lapsed, and the exporter obtained a new license covering the same export transaction, is such later license to be considered as “a validly outstanding: export license issued by the Board of Economic Warfare or the Department of State prior to April 30,1942”?
A. No.
7.	Q. Where goods to be exported pursuant to a contract of sale entered into prior to April 30, 1942, for which a specific license is not required, were on the pier prior to October 1,1942, but the ship did not sail until October 1 or later, does the exception cover them?
A. No; they must have been actually shipped before October 1.
8.	Q. Does the regulation control the commissions or fees which may be charged by purchasing agents or forwarders in the United States who act on behalf of a foreign importer?
A. No. Even though such an agent may take title to the goods and reinvoice them to the foreign importer, he is not regarded as an export seller and his commission or fee is not considered to be an export premium. 'ï’he amount of the commission or fee which he is pér-mitted to charge is/ however, governed by Maximum Price Regulation No. 165, as amended (Services).
9.	Q. How may protests or petitions for amendment be made under the Maximum Export Price Regulation?
’ A. In accordance with thé provisions of Revised Procedural, Regulation No. 1 of the Office of Price Administration for transactions under sections 2 and 3 and in accordance with the provisions of Revised Procedural Regulation No. 6 for transactions under section 1.
10.	Q. What remedy is afforded to a person on whom any provision of the regulation works excessive hardship? . A. He may file a petition for adjustment in accordance with the provisions of section 12 of the second Revised Maximum Export Price Regulation.
Part II—Definition of Export Sales (Section 11 (a) (1))
1.	Q. What constitutes an export for the purposes of the Maximum Export Price Regulation?
A. Any sale of a commodity by a seller or his agent in the continental United Stales to a purchaser outside thereof in which the selling or invoicing is done in the continental United States, or is done outside the continental United States on behalf of a principal or parent-firm in the continental United States, and the commodity sold is or has been transported from the continental United States to a point outside thereof.
2.	Q. What is the continental United States?
A. The continental United States includes only the 48 States and the District of Columbia. Sale and delivery to an American territory or possession is therefore an export - under this regulation.
3.	Q. If a person in the continental United States owns goods abroad and sells them to a foreign purchaser, would the sale be subject to the regulation?
A. Only if the seller transported the goods from the continental United States on or after April 30, 1942, the effective date of the original regulation.
4.	Q. If a person outside the continental United States owns goods in the continental United States and sells them to a person outside the continental United States, is the sale subject to the regulation?
A. Not unless the selling or invoicing is done in the continental United States.
5.	Q. If an American consigns goods to his agent abroad who sells them on his behalf to a foreign purchaser, is the sale governed by the regulation?
A. Yes; if the goods were shipped abroad on or after May 25, 1942, the effective date of Amendment 1 to the original regulation.
6.	Are sales to foreign agents or subsidiaries and resales by such agents or subsidiaries in a foreign country subject to the regulation?
A. See part VIH of these questions and answers.
7,	Q. Mr. Jones of South Africa sends you an order for goods. He instructs you to make delivery to his forwarders in New York, who will make payment upon delivery. You invoice in the name of Jones, The forwarder takes title and performs all of the mechanical functions of exporting. Is the transaction an export sale?
A. This would be considered an export sale on your part to Jones of South Africa.
8.	Q. Mr. Jones advises you that he is sending you an order for machinery
(10)
11
which will be paid for by his buying agent, Smith & Co. in New York. Smith & Co. confirms the order and sends you shipping and marking instructions. You deliver the material to Smith & Co., making the invoice in their name. They take title and ship to Jones. Smith and Co. submit the original invoice to Jones and they are paid a commission for their services. Is your sale to Smith & Co. an export sale?
A. Yes. Smith & Co. are not selling to Jones but take title merely as agents for Jones, your actual customer. If you charge a price in excess of your domestic ceiling, however, you must note on your invoice that disclosure has been made to you that Smith & Co. are taking title on behalf of a foreign importer. A proper form for such notation would be: “The prices shown on this invoice are export prices in view of your disclosure that you take title on behalf of a principal outside the continental United States.”
9.	Q. Mr. Jones placed his order through his branch office in New York, which takes title and attends to the mechanical functions of exporting, such as insuring, forwarding, etc. Is the transaction an export sale?
A. Yes. The branch house on these facts would be merely an agent of the foreign importer. If the invoice is made in the name of the branch house, however, and the price is in excess of your domestic ceiling, you must note on your invoice that disclosure has been made to you that the branch house is taking title on behalf of a foreign importer. Form of such notation is described in question 8 above.
10.	Q. Henry & Co., a New, York export house, asks you for a quotation on one of your products. You do not know whether Henry & Co. are buying the goods for their own account for resale at a profit or whether they are operating on a buying commission basis. Would the transaction be an export sale?
A. Not unless Henry & Co. are performing the duties of an agent directly to and for a foreign importer and disclose to you that they are taking title on behalf of such importer. Moreover, if such disclosure is made and your price to Henry & Co. is in excess of your domestic ceiling, you must make on your invoice the notation described in ques-. tion 8 above. Name of the foreign principal need not be noted on the invoice.
11.	Q. In the above case is it necessary for Henry & Co. to disclose the name of their foreign principal, as well as the fact of the agency?
A. No.
12.	Q. If Henry & Co. were acting as principals and buying the commodity for their own account either to fill an order received from a foreign customer or in anticipation of foreign orders in general, would the sale to Henry & Co. be an export sale?
A. No. The sale to Henry & Co. would be a domestic sale. But the seller may add to his domestic ceiling price the items of expense authorized by section 2 of the regulation in the case of sales to exporters. (See part IX of these questions and answers.)
13.	Q. An American concern buys machinery from a manufacturer or dealer for use in its operations abroad. Is the ¡Sale an export sale?
A. Generally, no. The buyer is not a purchaser outside the continental United States. The fact that it intends to ship the material abroad does not make the transaction an export sale. But the seller may add to his domestic ceiling price the items of expense authorized by section 2 of the regulation in the case of sales to persons who buy for their own account a commodity for shipment outside the continental United States.,- -(See part IX of these questions and answers.)
14.	Q. Suppose the American company discloses that it is taking title on behalf of an operating subsidiary or parent concern in the foreign country. Would the transaction then be an export sale?
A. Yes. If the seller’s price is above his export ceiling, of course, he must make on his invoice the notation described in question 8 above.
15.	Q. Hardy & Co., export merchants, sells goods to Lewis & Co., who intend to resell them to a person outside the continental United States. Is the sale by Hardy & Co. to Lewis & Co. an export sale?
A. No. It is a domestic transaction, subject to applicable domestic schedules or regulations. But Hardy & Co. may add to their domestic ceiling price the items of expense authorized by section 2 of the regulation in the case of sales to exporters.
Part III—Maximum Export Price (Section 3)
1.	Q. What is the usual method of calculating the maximum export price?
A. It is the exporter’s basic price as defined by section 3 (a) or 3 (b), plus (as a general rule) a premium representing export overhead and profit, plus expenses incident to the particular export, minus any net benefit resulting from drawback of import dfities, etc. Each of these component elements of the maximum export price is explained in an ensuing part of these questions and answers.
2.	Q. Are there any cases in which this method does not apply?
A. Yes. The regulation contains special provisions for solid fuels (section 3 (d)), for iron and steel products (section 8), and for commodities sold to procurement agencies of the United States for the account of the Office of Lend-Lease Administration (section 1). Section 3 (c) also contains special provisions for exporters who are manufacturers or producers of a commodity which is not sold domestically by any seller and for which there is no similar domestic product, or which is not sold domestically by any manufacturer or producer to the class of purchaser to which the' exporter sells outside the continental United States.
3.	Q. What rule applies where the exporter in voices a customer of his foreign buyer?
A. The invoice price to the customer of his foreign buyer must not exceed the export ceiling price which the exporter
could charge on a direct sale to such customer.
4.	Q. Suppose the exporter’s foreign buyer asks him to invoice the ultimate consumer at $120, which price includes the buyer’s resale profit of $30. The exporter’s maximum export price on a direct sale to the consumer would be $100. May he bill the goods at $120 if the net amount which he himself receives is only $90?
A. No. The highest price at which he could bill would be $100. If this restriction works excessive hardship on the exporter or on his foreign buyer, a petition for adjustment may be filed by the exporter or by his foreign customer in accordance with the provisions of section 12. This should, however, be done only in cases where there is a true hardship—as, for example, where direct invoicing would make unnecessary the payment of duties and port fees in the foreign country.
5.	Q. Suppose the exporter pays a commission to his foreign buyer’s purchasing agent in the United States, at the buyer’s request. May the exporter charge his buyer for such commission, over and above his export ceiling price for the commodity?
A. Yes. The commission is not a part of his export price. The exporter may include the commission in his invoice provided it is separately stated on the copy of the invoice which is rendered to the buyer.
In making out his export license application the exporter should show under question 12 on Form BEW 1191 the actual price charged to the foreign buyer. Underneath that price, as a separate item, he should show the amount of the commission which is added for the buyer’s account. The following statement is suggested: “__percent buying commission included in the letter of credit (or draft), which commission will be remitted to customer’s buying agent (name), $________” In no case
should the amount of the buying commission be shown as a premium.
6.	Q. Does the same rule apply where the purchasing agent is outside the United States?
A. No. The exporter is not permitted to. invoice his customer at a price in excess of his export ceiling.
Part IV—Basic Price (Section 3) »
1.	Q. What is the basic price for an exporter who is the manufacturer or producer of a commodity which is sold domestically?
A. His maximum domestic price for the commodity to a domestic purchaser similar to the purchaser outside the continental United States, or in case there is no such price, his maximum domestic price to such a similar purchaser for the most nearly similar commodity of equal or lower quality or grade.
2.	Q. What does the term “exporter who is the manufacturer or producer” mean?
A. It includes the manufacturer or producer as well as wholly owned subsidiaries of the manufacturer or pro-
1 Question 15 on the old form; question 9
on Form BEW 166.
12
ducer, related companies, all of whose stock is owned by a common parent, and persons to whose specifications and under whose supervision products are manufactured by another. It includes an exporter who performs any processing, converting, canning or assembling of parts prior to shipment.
3.	Q. Wha^ does “maximum domestic price” mean?
A. It means the highest price at which the particular seller may, under any applicable price schedule, regulation or order issued by the Office of Price Administration, sell, offer to sell, deliver or transfer a particular commodity to a given class of purchaser within the continental United States.
4.	Q. What does “domestic purchaser similar to the purchaser outside the continental United States” mean?
A. It means a domestic purchaser of the same general class as the purchaser outside the continental United States, e. g., manufacturer, wholesaler, jobber, exclusive distributor, retailer, government agency, public institution, individual consumer, or other class of purchaser for which the seller has an established price.
5.	Q. Suppose a manufacturer’s domestic ceiling price to a certain class of trade is his March 1942 list price less 20 percent. During the base periods he customarily sold to the same class of customer abroad at list less 40 percent. Is he required to continue selling at export at the latter price?
A. No. His domestic ceiling price to the same class of trade is permitted as the base for the maximum export price, though he may of course charge less.
6.	Q. What is the basic price for an exporter other than the manufacturer or producer?
A. Generally, it is either (1) the exporter’s cost of acquisition for the commodity, or (2) the maximum domestic price which his supplier could charge on a current sale to him, or (3) the maximum domestic price which the exporter would be permitted to charge, at the point from which the commodity is to be shipped for export, to a domestic purchaser similar to his foreign customer. Under (1) and (2) both the allowable premium and the allowable expenses may be added; under (3) no premium may be added, only expenses.
7.	Q. What does the term “cost of acquisition” mean?
A. It is the net price paid by the exporter to the supplier after all trade (including quantity), confidential, and cash discounts allowed by the supplier.
8.	Q. Where an exporter purchased and received delivery of a commodity prior to the establishment of a domestic ceiling, at a legal price higher than the domestic ceiling in existence at the 4 time of the export, may he use as the * basic price the cost of acquisition?
A. Yes, except in the case of iron and steel products for which special provision is made by section 8.
9.	Q. An exporter uses as his basic price his cost of acquisition. The price quoted by his supplier was $10 f. o. b. inland shipping point. The inland
freight was $1. Is the exporter’s cost of acquisition $10 or $11?
A. $10. In such a case the inland freight would Untreated as an allowable expense, to be added to the basic price, not as a part of the basic price.
10.	Q. Suppose the supplier had quoted $11 f. a. s., $11 f. o. b. cars at port of exit, or $11 f. o. b. inland shipping point with freight allowed to the-port of exit.
A. The exporter’s cost of acquisition would then include the freight and the premium would be figured on this cost.
11.	Q. If a firm acquired some materials at the current market price of 5 cents per pound and his supplier’s current domestic ceiling price to the exporter is 10 cents, may 10 cents be used as the basic price?
A. Yes.
12.	Q. An exporter buys a commodity from his supplier at a discount of 20 percent from the latter’s list price of $1. If he elects to use the supplier’s current domestic ceiling price to him as his basic price, instead of his actual cost of acquisition, would the basic price be $1 or 80 cents?
A. It depends on whether the discount represents a reduction below the supplier’s current maximum domestic price to him, taking into consideration any discounts, allowances, or differentials established by the applicable domestic schedule. If the supplier’s domestic ceiling price to him is $1, t^e Regulation would permit the exporter to retain the benefit of any discount, allowance, or commission which represents a reduction of the price below that figure. If, on the other hand, the net price of 80 cents is the maximum which his supplier is permitted to charge him, he would not be permitted to use a higher figure as his basic price.
13.	Q. If an exporter uses as his basic price his maximum domestic price to a similar domestic customer, must he take into consideration the quantity discounts or differentials established by the applicable domestic schedule?
A. Yes.
14.	Q. Where a firm acts as manufacturer in some transactions and as an export merchant in others, how is the basic price on an export to be determined?
A. The basic price in each transaction is calculated in accordance with the function of the exporter in that transaction.
Part V—The Export Premium (Section 4 (a))
1.	Q. What is the export premium?
A. It is a mark-up permitted over the basic price to take care of the exporter’s export overhead and selling expenses and his export profit.
“Export overhead and selling expenses” include wages and salaries; rent and general office expenses; mail, cable, and telephone expenses; financing costs, including interest, factoring costs, and cost of discounting drafts; advertising, selling agents’ commissions, and traveling representative and foreign branch expenses.
2.	Q. What premium does the regulation permit an exporter to add,to his
basic price in computing his maximum export price?
A. He may charge an amount which is not in excess of 125 percent of the average premium which was charged by similar exporters of the commodity, for the particular services or functions performed, during the period July 1 to December 31, 1940, or March 1 to April 15, •1942, whichever figure is the lower. For example, if the applicable base period premium is 10 percent, the exporter may now use 125 percent of this premium, or 12% percent.
3.	Q. What is the meaning of the term “average 'premium”?
A. The average premium refers to the premium customary in the trade rather than to any mathematical average of premiums charged by exporters of the same or a similar commodity.
In the case of exporters who are the manufacturers or producers of the commodity being exported, the average premium refers to the export mark-up, if any, which was customarily added by similar exporters during the base period to their domestic prices to the same class of trade to take care of their export overhead and selling expenses and their export profit.
In the case of exporters who are not manufacturers or producers of the commodity being exported, it refers to the mark-up, if any, which was customarily added by similar exporters during the base period to their cost of acquisition to take care of their export overhead and selling expenses and their export profit.
4.	Q. Is the amount a percentage or a flat amount, and must the exporter ’figure it for each separate commodity or may he use an over-all figure for a group of commodities?
A. It depends on what was the customary practice among similar exporters during the base periods.
5.	Q. Is the average premium generally the same for all types of exporters of a particular commodity?
A. No. For example, the manufacturer’s premium constitutes an additional charge beyond his domestic price, which already includes a profit to him. Hence he has usually charged a lower premium than export merchants handling the same commodity, or no premium at all. Again, the premium may vary according to the type of selling effort involved. Thus, exporters who engage in active sales promotion abroad may customarily have charged somewhat higher premiums than exporters who do not engage in this type of operations; and export merchants who maintain stocks on hand to meet current orders may customarily have charged higher premiums than those who order from the factory only after the receipt of firm orders from customers abroad.
6.	Q. What other differentials existing during the base periods are to be taken into account in determining the average premium?
A. All the usual differentials of the particular trade involved. Where, for example, the base period practice was to vary the premium according to differences in credit risks, terms of payment, or the functions performed in securing
13
and financing ocean transportation and insurance, these differentials should be considered now in establishing the permissible premium. Differences in premiums in the base periods resulting from variations in the class of purchaser, destination of the shipment, and the functions performed by agents or subsidiaries at the destination (e. g., engineering and servicing) are also to be taken into account. The size of the individual order will in many cases, of course, be an important factor in determining the applicable premium.
7.	Q. How can an exporter determine what the average premium in the trade was during the base periods?
A. Most exporters know in a general way what were the customary premiums in the export trade during the base periods for the particular commodities which they export. Trade associations, trade journals, and representative exporters may be consulted for additional information. The individual practice of an exporter who did regular export business in the Commodity concerned will be some indication of the average premium.
8.	Q. If, during the lower base period, it was customary for manufacturers or producers of the commodity to make export sales at prices which—except for the specific export expenses dealt with in section 4(b) of the regulationa—were equal to or lower than their domestic selling prices to the same class of trade, what is the allowable premium?
. A. There is no premium. However, it should be noted that where the export price has customarily been below the domestic price, the manufacturer or producer may nevertheless use his domestic ceiling price to a domestic customer similar to the foreign buyer as his basic price and add his specific export expenses. -
9.	Q. What about exporters other than manufacturer' or producers who may also have made export sales at prices which—except for their specific export expenses—were customarily equal to or lower than their domestic prices to the same class of trade?
A. They had a premium if they were exporting at prices above their cost of acquisition and their specific export expenses. However, it should be noted that if such an exporter now uses his domestic ceiling price as his basic price, he cannot add a premium.
10.	Q. Does the fact that an exporter did not himself charge any premium during one or both of the base periods prevent him from adding one now?
A. Not unless his base-period practice was representative of the custom in the export trade on the particular type of sale involved. Conversely, the fact that a particular exporter charged a premium in the applicable base period does not entitle him to charge that premium now if his practice was not representative of the trade custom ¡in that period.
11.	Q. An export merchant buys some goods at his supplier’s ceiling price of $100 f. o. b. the supplier’s plant. He incurs inland freight, cartage, warehousing, etc., amounting to $25 in placing the goods alongside steamer. In addi-
2 See part VI of these questions and answers.
tion he lays out a total of $35 for ocean freight and marine and war risk insurance. The applicable premium is 10 percent. Is this mark-up to be figured as a percentage of $100, of $125, or of $160?
A. As a percentage of the basic price— $100—not as a percentage of the f. a. s. or c. i. f. selling price or of the exporter’s total investment in the transaction. The applicable base period premium includes, however, compensation for the financing costs and other overhead expense involved in securing and financing inland and ocean transportation, warehousing, insurance, etc., as well as for the extra risks involved in f. a. s. or c. i. f. delivery terms. In determining the applicable premium, of course, the exporter should take into account any differentials in the customary base period premium based upon the functions performed in laying out freight, etc., for his customer or upon the type of quotation used.
12.	Q. What individual adjustment can be made in the premium in the case of an exporter whose financing or other overhead expenses are greater than during the'base periods?
A. Ordinarily, none. The 25 percent increase in premiums which is permitted by the second revision of the regulation is intended to compensate exporters for any increase in their total export overhead and selling expenses since the 1940 base period.
13.	Q. May the maximum export price of the exporter be increased by virtue of the fact that he is paying a commission to a foreign selling agent?
A. Selling agents’ commissions are one of the items of selling expense which are represented by the premium. Thus when the exporter computes the average premium of the applicable base period, this premium will reflect the customary commissions paid to selling agents during that period. An exporter may, of course, pay his agent any commission he chooses, so long as his premium is not raised above the average premium of the lower base period.
14.	Q. An exporter’s arrangement with his foreign agent is, that the latter will take orders at prices which the agent himself will determine and that the exporter will bill the customer at those prices and remit to the agent as the latter’s commission the difference between the invoice price and a stated figure. Does the Regulation limit the amount of the invoice price to the customer under these circumstances?
A. Yes. The fact that the agent fixes the price, not the principal, makes no difference. The principal is not permitted to bill his customer at a price which exceeds the maximum permitted by the Regulation, even though the net amount which he himself receives may be within such maximum.
15.	Q. Would it make any difference if the agent were operating on a consignment basis?
A. No. The transaction is still a sale by the principal. See part VHI of these questions and answers.
16.	Q. May the maximum export price of the exporter be increased by virtue of the fact that he is paying a brokerage
fee or commission to a purchasing agent employed by him?
A. No.
17.	Q. An American manufacturer employs an export manager or agent in the United States and pays the latter a commission for his services. May the manufacturer’s maximum export price be increased by virtue of the fact that he is paying such a commission?
A. Such commissions, like commissions paid to foreign selling agents, are one of the items of selling expense which are represented by the manufacturer’s premium. Thus, when the manufacturer computes the average premium of the applicable base period, this premium will reflect the customary commissions paid to such agents during that period.
It should be noted that the transaction is regarded as an export sale by the manufacturer, regardless of whether the invoicing is done by the manufacturer or by the agent.
It should also be noted that the amount of the commission which the manufacturer may pay the agent out of his export ceiling price is governed by the provisions of Maximum Price Regulation 165 (Services), issued by the Office of Price Administration.
18.	Q. A manufacturer uses a New York export house to act as his export “department.” The export house buys the goods from the manufacturer, pays for them, and resells for its own account. May the export department charge an export premium?
A. Yes; it may- charge 125 percent of the average premium which was charged by similar exporters in the lower base period. In such a case the export house would be the exporter and the sale to it by the manufacturer would be a domestic sale. The case differs from the situation in question 17, where the export house did not act as an independent distributor but as an export agent on a commission basis.
19.	Q. What is the meaning of the provision in the regulation to the effect that the applicable average export premium shall not be increased by reason of the fact that more than one exporter participates in the process of exportation?
A. It means that the total of the premiums claimed by the exporters shall not exceed the lower base-period premium which could be claimed by an exporter handling the whole process of exportation.
20.	Q. Does the regulation provide for any determination of the average premium other than by exporters themselves, or for anything instead of the average premium?
A. Yes; the Office of Price Administration itself may, from time to time, promulgate figures which shall reflect the average premium as described above. Also, where the base periods are determined by the Price Administrator to be inappropriate, or where the trade or industry finds great difficulty in discovering an appropriate premium in the base periods, the Office of Price Administration may publish a specific'maxi-mum premium for the entire trade or industry.
14
21.	Q. Has any action been taken under that provision?
A. Yes; with respect to the cotton textile export trade (section 7 (a)), domestic chrome ores and concentrates (section 7 (b)), bituminous coal (section 7 (c)), iron and steel products (section 8), and finished rice (Amendment No. 1 to the Second Revised Maximum Export Price Regulation).
22.	Q. What about commodities which, during the second of the two base periods, were covered by individual schedules which did not permit the charging of any premium on export sales?
A. Section 4 (a) of the Regulation permits the exporter to disregard the second base period in such a case and to use as his allowable premium 125 percent of the average premium charged during the first base period.
23.	Q. What about commodities which, during the second of the two base periods, were covered by individual schedules which established maximum premiums on export sales?
A. The premium so established was, of course, the maximum which exporters of the commodity were permitted to charge during the second base period. The customary premium which was actually charged in the trade during that period may, however, have been below this maximum.
*If the average premium of the first base period was lower, of course, 125 percent of that premium must be used.
Part VI—Allowable Expenses (Section 4 (b))
1.	Q. What items may an exporter add to the basic price in addition to the premium?
A. In general, he may add certain expenses actually incurred or to be incurred by- him, which are not represented by the premium, which would not be involved in a domestic sale, and which are incident to exporting the commodity.
2.	Q. What sort of expenses may be added to the basic price plus premium in computing the exporter’s maximum export price if he sells f. o. b. inland shipping point?
A. Packing costs in excess of those incurred on domestic sales.8 He may recover, however, any money laid out for the account of the buyer for inland or ocean freight, insurance, etc.
3.	Q. What further expenses may be added in computing the maximum export price if the exporter sells f. o. b. port of exit?
- A. Inland transportation charges actually incurred to the port of exit.8
4.	Q. What further expenses may be added in computing the maximum export price if the exporter sells f. a. s. vessel?
A. Transfer from the inland carrier to the steamer, demurrage, warehousing
8 These answers are based upon the definition of foreign trade delivery terms as published in the Revised American Foreign Trade Definitions, adopted July 30, 1941, by a Joint Committee representing the Chamber of Commerce of the United States of America, National Council of American Importers, Inc., and National Foreign Trade Council, Inc.
awaiting shipment, and forwarders fees actually incurred.®
5.	Q. What still further expenses may be added in computing the maximum export price if the exporter sells c. i. f. port of destination?
A. Ocean freight, marine insurance, and other ocean shipping charges. War risk insurance and consular fees are not regularly included in c. i. f. terms, but may be added if they are so included.®
6.	May the exporter add anything to his basic price for inland freight when he uses his domestic ceiling price as his basic price and such price is a delivered price at the port of exit?
A. No; but he may add the expenses actually incurred by him for transfer from customary delivery point within the port city to steamer side. Moreover, if an emergency port is used, the exporter is permitted to use as his basic price the delivered price at the normal port and to add to that basic price the difference between the inland freight actually incurred to the emergency port and the freight which he would have incurred had he used the normal port.
7.	Q. Suppose the exporter’s domestic -ceiling price is established f. o. b. interior shipping point with the seller required to absorb all or part of the inland freight? If he uses this ceiling price as his basic price, what amount may be added thereto for inland freight?
A. Nothing if the domestic schedule requires him to allow all of the inland freight on domestic sales. If the schedule'requires him to allow only a part of the freight, he may add to his basic price the amount of freight actually incurred less the amount of the allowance. In either case, he may add the expenses actually incurred by him for transfer from customary delivery point within the port city to steamer side. Furthermore, if he uses an emergency port, he may add to the basic price the freight actually incurred to the emergency port less the amount of freight which he would have been required to absorb had he used the normal port.
8.	Q. What is the meaning of the terms "normal port” and “emergency port”?
A. “Normal port of exit” means the port of exit in the continental United States from which the exporter would customarily have shipped the commodity in export to a particular destination during the period July 1 to December 31, 1941.
“Emergency port” means the port from which the commodity being exported is actually shipped in export, when the “normal port of exit” is not available.
9.	Q. If, in order to obtain shipping space, a shipment must be transferred from the intended port of exit to another port, may the additional inland freight and other inland shipping charges actually incurred be added to the basic price plus premium?
A. Yes.
10.	Q. What additional expenses may be added to the basic price plus premium in the export of distress or stranded materials—that is, goods intended for previous export and started on their way to their foreign destination, but not transported abroad to the intended buyer be
cause of war conditions, and accumulating various charges before being sold to a new buyer?
A. On an export sale of such materials, accumulated warehousing, handling, insurance, and shipping expenses may also be added to the basic price plus premium.
11.	Q. May installation and servicing charges be treated as allowable expenses?
A. No. Where servicing and installation were customarily included in the export price for the commodity during the base periods, the average premium will reflect the customary cost to the exporter of performing these services or functions. Where, on the other hand, servicing and installation were not customarily included in the export price of the commodity durjng the base periods, but were charged separately, they must be separately charged and billed today as an engineering service—With the proviso that where this rule results in excessive hardship to the exporter or his customer, a petition for adjustment may be filed in accordance with the provisions of section 12.
It should be borne in mind that where an exporter uses as his basic price his domestic ceiling price, the ceiling may include servicing and installation, in which case no extra charge may be made.
12.	Q. During the base period a manufacturer quoted to his foreign customers the same price, f. a. s. port of exit, which he quoted f. o. b. plant to the domestic trade. His domestic ceiling price is now $1 f. o. b. plant. Is he required to quote this price f. a. s. port of exit, thus absorbing the inland freight of 10 cents on his export sales as he did in the past?
A. No. He may quote an export price of $1 f. o. b. plant or $1.10 f. a. s. The regulation does not require him to sell at export for less than the total of his domestic ceiling price and his specific export expenses.
13.	Q. During the base period a manufacturer made no specific charge for extra export packing. May he add the expense of such packing to his basic price today?
A. Yes. But if the base period premium included a charge for this packing, the premium should now be reduced accordingly.
14.	Q. May foreign bank collection charges be added to the basic price as allowable expenses in computing the maximum export price?
A. Yes.
15.	Q. Are foreign stamp taxes allowable expenses?
A. Yes.
Part VH—Drawbacks and Subsidies (Sections)
• 1. Q. May a manufacturer or producer retain the full benefit of any drawback of import duties or excise taxes, or any export subsidy to which he is entitled and lays claim?
A. Yes; unless it was customary for similar exporters of the commodity during the base period to pass on the benefit (or a part of the benefit) of such drawback or subsidy to the foreign purchase via a reduction of the export price below
15
the level of their domestic prices to the same class of trade plus their specific export expenses. (See questions 2 and 3.) Thus, where it was customary for similar exporters of the commodity during the base period to charge export prices which (exclusive of their specific export expenses) were either above their domestic prices or the same as their domestic prices, they may today retain the full benefit of any draw-back or subsidy to which they are entitled and lay claim. The draw-back or subsidy, ih such a case, constituted the base period premium, or a part of such premium, and its retention today would not operate to increase the premium above the base period level.
2.	Q. Is the same thing true of exporters who are not the manufacturers or producers of the commodity which is being exported?
A. Yes. They may retain the full benefit of the draw-back or subsidy today if it was customarily retained as a part of the premium during the lower base period—that is, if their export prices (exclusive of their specific export expenses) were customarily the same as or above their acquisition costs.
3.	Q. Suppose it was customary during ¿he base period for manufacturers or producers of the commodity to pass on all of the benefit of the draw-back or subsidy to the foreign customer—that is to say, the export price, exclusive of specific export expenses, was customarily below the domestic price by the full amount of the draw-back or subsidy or more. How would the exporter compute his export ceiling price today?
A. He would take the total of his basic price and specific export expenses and deduct therefrom the full amount of the draw-back or subsidy' to which he is currently entitled and lays claim, with allowance for the expenses incurred in obtaining the draw-back or subsidy.
Example 1. Assume that during the lower base period manufacturers of the commodity customarily Sold at export at prices which, exclusive of their specific export expenses, were 10 cents or more below their domestic prices to the same class of trade. They received a drawback of 10 cents. Since the export price was below the domestic by the full amount of the draw-back or more, no part of the draw-back was retained and there was no average premium. Today, a manufacturer of the commodity would compute his export ceiling price by taking his domestic ceiling price to the same class of trade, adding his specific export expenses and deducting the full amount of draw-back which he now received, with allowance for expenses incurred in obtaining it.
4.	Q. Suppose it was customary during the base period to pass on a part of the benefit of the draw-back or subsidy to the foreign customer and to retain the rest—that is, the export price, exclusive of specific export expenses, was customarily below the domestic price (in the case of manufacturers or producers), or acquisition cost (in the case of other exporters) by less than the full amount of the draw-back or subsidy. How would the exporter compute his export ceiling price today?
A. That part of the draw-back or subsidy which was customarily retained by similar exporters during the base period would constitute the average base period premium. The exporter would now take the total of his basic price and specific export expenses, add thereto a premium equal to that of the lower base period, and deduct from the sum of these items the full amount of the draw-back or subsidy to which he is now entitled and lays claim, with allowance for the expenses incurred in obtaining the drawback or subsidy.
Example 2. Assume that during the lower base period manufacturers of a commodity customarily sold it at export at prices which on the average were 5 cents per pound below their domestic prices to the same class of trade. They received a draw-back of 10 cents. The average premium war therefore 5 cents. Today they could add a premium of 5 cents to their domestic ceiling prices to the same class of trade, plus their specific export expenses, and from this total they would be required to deduct the full amount of draw-back which they currently receive, with allowance for the expense incurred in obtaining the drawback.
5.	Q. What about cases where the exporter is a manufacturer and his cost of manufacture of the exported commodity is higher than his cost of manufacture of the same or similar commodity sold domestically?
A. In such cases, the deduction required under questions 3 and 4 above would be reduced by the amount by which his cost of manufacturing the exported commodity exceeds his cost of manufacturing the same or a similar domestic commodity. Thus, if the exporter paid 3 cents a pound more for the imported raw materials used in the manufacture of the exported commodity than he paid for the same imported raw material for use in the manufacture of the same or similar domestic commodity, he would deduct only 7 cents, instead of 10 cents, in examples 1 and 2 above, in computing his current export ceiling.
Part VIH—Sales by Foreign Agents or Controlled Firms (Sections 11 (a) (1) (v) and 9 (g))
1.	Q. Are sales by an American seller to a firm abroad which is owned or controlled by him subject to the regulation?
A. Yes.
3.	Q. What about sales or resales by such foreign agents or controlled firms?
A. “Export sale” is defined to include any sale of the exported commodity by an agent of the exporter or by a firm owned or controlled by the exporter within a period of two years after the date of shipment of the commodity from continental United States—unless (1) the agent or firm has substantially changed the form of the commodity; or (2) the sale is made through a regularly established retail outlet owned or operated by the agent or firm; or (3) the sale by an agent of a manufacturer or producer of the commodity, or by a firm controlled by the manufacturer or producer, is made in the United Kingdom,
Canada, South Africa, Australia, or New Zealand.
3.	Q. Would the regulation apply to the sale by the agent or controlled firm of a commodity which was shipped abroad by the American principal or parent concern before May 25, 1942 (the effective date of Amendment 1 to the original regulation), but which is still held in stock by the foreign agent or owned or controlled firm?
A. No.
4.	Q. When the sale or resale is made by an agent or by an owned or controlled firm abroad, how is the price to the ultimate buyer computed?
A. Generally, in the same manner as if the sale-were made direct to such buyer by the exporter in the United States. That is to say, the total of the premiums added by the exporter and by the agent or subsidiary must not exceed the allowable premium which the domestic exporter would be permitted to charge the foreign purchaser if he were selling directly to such purchaser and performing the same services or functions through direct employees.
5.	Q. Does this mean that no provision is made for the general overhead expenses and profit margin of the agent or subsidiary?
A. No. Section 4 (a) provides that in determining the applicable premium, due recognition shall be given to the functions performed by agents or subsidiaries abroad. This means that in computing the applicable base-period premium exporters may refer to the combined premium charged on similar exports by exporters and their foreign agents or subsidiaries. But the total of the premiums claimed by the exporter and his agent or subsidiary must not exceed the lower base-period premium customary in the trade for the general overhead expenses and profit margins ascribable to the export functions of such exporters and their agents or subsidiaries.
. 6. Q. If the foreign agent or subsidiary incurs expenses abroad for import duties, port fees, freight, etc., may these items be treated as allowable expenses in computing the maximum export price to the foreign buyer?
A. Yes.
7,	Q. What is the scope of the exemption of sales by agents or controlled firms in the United Kingdom, The Dominions of Australia, New Zealand, the Union of South Africa and Canada?
A. It should be noted that the sale is exempted only when it is made by the agent or controlled firm in the foreign country. Thus, if the agent merely procures the order and the goods are shipped and invoiced to the foreign buyer by the principal in the United States, the transaction is governed by the regulation. When, on the other hand, the agent is operating on a consignment basis and the sale is made by the agent in the foreign country, the transaction would be exempt. Similarly, if the principal or parent sells the goods to the foreign agent or controlled firm and the latter sells or resells them in the foreign country, the resale would be exempt—although the sale to the agent
16
or controlled firm remains subject to the regulation.
Part IX—Sales to Private Exporters and to Government Procurement Agencies', (Sections 1, 2, 11 (a) (1) (ii), and 11 (a) (1) (iii))
1.	Q. Does the regulation make any provision for export expenses incurred on sales to buyers in the continental United States who intend to export?
A. As already explained in part II of these questions and answers, a sale to a buyer in the continental United States who does not take title on behalf of a foreign principal, but buys for his own account with the intent either to resell the commodity to a foreign buyer or to ship it abroad for his own use, is a domestic sale, subject to domestic price regulations. However, section 2 of the regulation permits the seller to add to his domestic ceiling price (a) packing costs in excess of those incurred on domestic sales and (b) the difference between the greater cost of installation and servicing involved in the sale and the cost of installation and servicing involved in a comparable domestic sale, whether such installation or servicing is performed directly or by a distributor or agent.
If the applicable domestic schedule contains specific provisions for installation and servicing on sales to exporters, those provisions shall govern.
2.	Q. Is a sale to an agency of the United States which is not* buying for the account of the Office of Lend-Lease Administration covered by the Regulation if the agency is buying the commodity for shipment outside the continental United States?
A. Yes. Such a sale would be considered a sale to an exporter and governed by section 2 of the regulation.
3.	Q. Does a sale to an agency of a foreign government come under the regulation?
A. Yes. Such sales are treated as ordinary export sales (section 11 (a) (1) (iii)).
4.	Q. Does a sale- to a procurement agency of the United States buying for the account of the Office of Lend Lease Administration come under the regulation?
' A. Yes; but such sales are not treated in the same way as private export sales. Section 1 of the regulation requires the seller to use as his basic price the maximum domestic price established for such transactions by the applicable domestic schedule or regulation. To this basic price he is permitted to add the following charges if he shows them separately on his invoice: (a) The extra packing expenses as allowed by Supplementary Order No. 34; and (b) the difference between the greater cost of installation or other necessary services involved in the sale and the cost of installation or other necessary services which would have been involved in a domestic sale, if such installation or services are. contracted for by an agency of the United States. It makes no difference whether such installation or services are performed directly by the.seller or by his distributor or agent.
The seller is not entitled to the export premium permitted by section 4 (a) of the regulation on other export sales and he is not permitted to add to his domestic ceiling price allowable expenses by virtue of section 4 (b).
It should be borne in mind that if the applicable domestic schedule makes specific provision for extra packing, installation, servicing, or other necessary services on lend-lease sales, that provision shall govern.
5.	Q. Does section 1 entitle the seller to compensation for the overhead expenses of his export department or foreign branch house or for his past efforts in building up his foreign selling organization and developing a market abroad for his products?
A. No. Payment of extra compensation over and above the seller’s domestic ceiling is limited to payment for installation, engineering and other necessary work performed by the seller or his foreign branch house, subsidiary, or representative in conjunction with the particular sale.
6.	Q. Does section 1 entitle the seller to extra compensation for commissions payable to an export agent, either in the United States or overseas?
A. If the agent performs a bona fide and necessary service in connection with the particular sale (such as engineering, installation, servicing, etc.), the procurement agency may pay to the principal extra compensation for the greater cost of these services over and above what would be involved in a domestic sale. Out of the total price received the seller may pay his agent whatever commission he chooses, unless prohibited from doing so by the rules of the buying agency.
7.	Q. Suppose the agent performs only selling functions—i. e. he originates the business and the order is subsequently switched to lend-lease. If the seller pays the agent a selling commission, may he be paid extra compensation therefor?
A. Yes; if the amount of such commission exceeds the cost of making domestic sales of the commodity and if the procurement agency recognizes such commissions as payments for “necessary services” within thé meaning of the regulation.
8.	Q. Suppose the seller has contracted to pay his foreign agent a commission on all sales of the seller’s product to customers in the agent’s foreign territory, regardless of whether such sales are originated by the agent. May the seller be paid any extra compensation for such Commissions if the agent performs no selling or other function in connection with the particular sale?
A. No.
9.	Q. Is payment of the extra compensation authorized by section 1 mandatory?
A. No. Payment of such extra compensation is left to the discretion of the procurement agency involved and the amount of compensation which the seller receives will depend on the terms of the contract which he’ negotiates.
It is understood that insofar as the domestic ceiling price is adequate to cover the cost of extra export packing, installation, and other necessary serv
ices, additional compensation will not be paid. It is also understood that if the foreign government makes payment in its own’ currency for services performed abroad by the seller in connection with the sale, that fact will be taken into consideration by the procurement agency in fixing the price under section 1.
Part X—Export Licenses and Filing of Export Prices'
1.	Q. Where can information be obtained as to filling out applications for export licenses?
A. From the Office of Exports, Board of Economic Warfare, Washington, D. C., from the New York field office of the B. E. W. or from the field offices of the Department of Commerce. If the information relates to the price data required on the license application, the inquiry should be directed to the Office of Export-Import Price Control, Office of Price Administration, Washington, D. C., or to the appropriate OPA Regional Office.
2.	Q. Is it necessary for the exporter to obtain advance approval of his export price from the Office of Price Administration before filing his license application with the BEW?
A. No. However, in the case of a commodity which is not sold domestically and which must therefore be priced in accordance with the provisions of section 3 (c) of the regulation, no export sale may be made until the requirements of that Section have been complied with.
3.	Q. Does a specific license granted by the Board of Economic Warfare or the Department of State for an export sale whose price exceeds that permitted under the Maximum Export Price Regulation, or previously under a specific regulation, constitute an exemption from the price regulation or a sanctioning of t^e price?
A. Neither. The granting of a license is not a determination that a price violation has not occurred, nor does it prevent proceedings to rectify violation—unless it is in a case where the Price Administrator has granted an exception to the provisions of the Maximum Export Price Regulation on certification by the Board of Economic Warfare that such exception is necessary for considerations of political or military necessity or because of the requirements of economic warfare.
4.	Q. May the BEW return a license application on price grounds if the price is within the maximum established by the regulation?
A. Yes. For example, the application may be returned because the export price stated thereon appears to be in excess of current market prices and the exportation at such price is considered contrary to the national interest.
5.	Q. How detailed a description of the commodity being exported is called for by question 11 on Form BEW-119?4
A. The applicant must give the Department of Commerce number shown in the current Comprehensive Export Schedule. In addition, the exporter should describe the commodity in sufficient detail so that the domestic ceiling price may be checked by the examiners.
* Question 14 on the old form; question 8 on Form BEW 163.
17
Manufacturers’ numbers, government or trade standards, trade names, or other description may be used to assist the identification. In cases where grades, sizes, type of packing, type of container, number of units per container, etc., are pertinent, full details should be given. If the price of the commodity is subject to the control of a specific domestic price schedule, the classifications and descriptions in the pertinent schedule must be followed.
6.	Q. What information should be given under question 12 on Form BEW-119? 5
A. The applicant must show his total selling price in the form of quotation actually used in the particular transaction (such as f. o. b. factory, f. a. s. named port). In addition to the particular form of price quotation, the applicant must also indicate the specific inland point or specific port of exist to which the price quotation refers. If the quotation is f. o. b. named port, the applicant should indicate whether the price is f. o. b. cars, f. o. b. buyer’s warehouse, or f. o. b. vessel.
The selling price per unit must also be shown, except where a large variety of products within a single Schedule B classification makes such a break-down extremely difficult. In such cases, only the total price need be shown.
7.	Q. What special points should be borne in mind by the exporter if he shows his supplier’s current domestic ceiling price to him as his basic price under question 17?
A. In computing the basic price he should take into account any discounts, allowances or differentials which are established by the domestic regulation applicable to the sale to him by his supplier—including quantity discounts and discounts or differentials to different classes of trade.
8.	Q. What speciat points should be borne in mind by the exporter if he shows his cost of acquisition at his basic price under question 17?
A. He should show the net price charged him by his supplier, after deducting all discounts, commissions, and allowances. He should also indicate whether this net price is f. o. b. named inland shipping point, f. o. b. named port of exit, etc.
9.	Q. An exporter shows an f. a. s. price of 14 cents per pound under question 12 on Form BEW 119,8 which price is computed as follows: Basic price—cost of acquisition, 10 cents; premium, 2 cents; extra export packing, freight, etc., 2 cents. After issuance of the license he acquires the goods at 5 cents. Does this call for a change in his export price?
A. If, by the reduction of the cost of acquisition the premium is increased beyond the premium permitted by the regulation, the export price must be reduced accordingly, assuming he continues to use his cost of acquisition as his basic price.
Regardless of whether the selling price is reduced, no amendment of the license
6 Question 15 on the old form; question 9 on Form BEW-166.
6 Question 15 on the old form; question 9 on Form BEW 166.
is necessary. However, he must attach a letter to the license, when submitted to the customs, indicating the new acquisition cost and declaring that the selling price is not in excess of the maximum permitted by the regulation.
In this connection the exporter would do well to bear in mind that the regulation permits him to use as his basic price his supplier’s current domestic ceiling price to him. In the case above, the exporter need not change his price if the supplier’s maximum price to him is 10 cents per unit or higher. In such a case, however, he must attach a letter to the license when submitted to the customs indicating that he is now electing to use his supplier’s ceiling as his basic price, showing the amount of such ceiling, and declaring that the selling price is not in excess of the maximum permitted by the regulation.
10.	Q. What must an exporter do when, after issuance of the license, cost of acquisition^ is increased and the exporter wishes to increase his selling price?
A. He must return his license to Washington with a letter of transmittal setting forth the circumstances and requesting the desired amendment.
11.	Q. In making out his export license application may the exporter show one amount under question 17 on Form BEW 1197 to cover both his premium and his allowable expenses?
A. No. The premium must be separately stated.
12.	Q. Is the exporter required to itemize his allowable expenses on his export license application?
A. No. He is required to state only the basic price and the premium under ques- ’ tion 177 and the total selling price and unit value under question 12.8 The difference is considered to be his expenses. (If extraordinary expenses are incurred, they should be explained in an attached statement in order to avoid delay in approval of the license.)
13.	Q. If an exporter who is selling on an f. a. s. or c. i. f. basis cannot accurately estimate his allowable expenses for packing, freight, etc., at the time of filing his export license application, how should he answer question 12 on Form BEW 119? 8
A. He should estimate the expenses as best he can in calculating the total selling price and unit value required to be shown on the license application. If his expenses turn out to be higher or lower than estimated, he should follow the procedure outlined in question 14 or 15 below.
14.	Q. In calculating the total selling price, under question 12 on Form BEW 119,8 the exporter included an amount of $10 to cover his allowable expenses for packing, freight, etc. The amount actually incurred turns out to be only $8. Does this call for a change in his export price?
A. He must reduce his selling price, unless that price was already below his export ceiling by $2 or more. Regardless
7 Question 15 on Form BEW 166.
8 Question 15 on the old form; question 9
on Form BEW 166
of whether the selling price is reduced, no amendment of the license is necessary. However, he must attach a letter to the license, when submitted to customs, indicating the actual amount of the expenses and declaring that the selling price is not in excess of the maximum permitted by the regulation.
15.	Q. What happens when, after issuance of the license, the exporter’s allowable expenses for freight, handling, etc., turn out to be higher than he had estimated and he wishes to increase his selling price above the figure shown under question No. 12 on Form BEW 119? 8
A. No amendment of the license is necessary. If the price quoted on the export declaration exceeds the price shown on the license, the collector of customs will permit shipment provided the exporter or his agent files a Price Certificate in the form prescribed by the Comprehensive Export Schedule issued by the BEW, explaining the discrepancy between the two prices.
16.	Is there any procedure for filing export prices with OPA?
A. In order to simplify the processing of export license applications, the Office of Export-Import Price Control, OPA, now permits manufacturers to file their export prices. These prices are checked for conformity with the Export Price Regulation and are used to check the selling prices shown on export license applications submitted to the Board of Economic Warfare. It should be noted that this procedure is entirely optional and that it is limited to manufacturers.
17.	Q. How would an exporter answer the price questions on the export license application if he had filed his export prices with OPA?
A. Instead of giving the detailed data on his basic price and premium under question 17 on Form BEW 119,9 he would merely insert the statement “Filed with OPA” and give the date of the filing. The total selling price must be shown under question 12 as before. It is particularly necessary to show the unit selling price under question 12 in order to reduce the amount of clerical work required in comparing license applications with the prices on file.
18.	Q. With whom does the exporter file his export prices?
A. With the Office of Export-Import Price Control of the Office of Price Administration, Washington, D. C.
19.	Q. If a manufacturer’s export prices are the same as or less than his domestic prices and he has already filed his domestic prices with one of the domestic commodity branches, need he make a separate filing of his export prices with the Office of Export-Import Price Control?
A. Yes. The domestic price filing is not conveniently available to the staff of that office for the purpose of checking the applications for export licenses. In addition, certain information is required which would not be contained in the domestic filing.
20.	Q. What price information must be given on the export filing?
A. The price information which is filed with the Office of Export-Import Price
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Control must provide the answers which would have been given to question 17 on Form BEW 119.“ That is, the exporter must state separately his basic domestic price and his premium, if any. The type of basic domestic price used as permitted under section 3 (b) must be indicated. Any new information regarding prices which may be required by subsequent revisions of Form BEW 119 must be added.
It is particularly important that the commodity for which a price is submitted be accurately identified. The manufacturer should give the same description of the commodity which he would be required to give on the export license application. (See question 5 above.) The description of the article given on the export license application must correspond with that given in the list of filed prices so that the article to be exported may be identified on the manufacturer’s filed list.
21.	Q. Must changes in export prices as filed be reported to the Office of Export-Import Price Control?
A. Yes; such changes must be reported prior to or at the time such new prices are used on an export license application.
22.	Q. Is the same price information required on applications for certificates of release submitted to British Empire supply missions as is required on Form BEW 119?
A. Yes. However, if the exporter prefers he may submit the full price information directly to the Office of Export-Import Price Control, OPA, and then show only the total and unit selling price on the Application filed with the supply mission.
Part XI—Sales in the Territories and Possessions of the United States
1.	Q. How does Amendment 2 to the Second Revised Maximum Export Price Regulation affect export sales to the Territories and possessions of the United States?
A. It clarifies the relationship between the Second Revised Maximum Export Price Regulation and Territorial regulations by providing that regardless of the provisions of the Export Regulation no sale may be made in a Territory or possession of the United States to a pur-
- 8 Question 15 on Form BEW 166.
chaser therein at a price in excess of that which is established by any maximum price regulation, price schedule or order applicable in such Territory or possession of the United States.
2.	Q. Does Amendment 2 make the Export Regulation inapplicable to export sales to the Territories and possessions?
A. No. The Export Regulation remains in full force and effect. Applicable regulations in the Territories and possessions, however, provide a limit on the price which may be paid by the purchaser in the Territory or possession. If there is no regulation, schedule or order applicable in the Territory or possession, the maximum price is to be computed under the Export Regulation to the extent that it is applicable to the transaction.
3.	Q. In what type of transaction is the price payable under the Export Regulation limited by a regulation applicable to sales in the Territories and possessions?
A. Only under the following circumstances:
1.	Where the sale is made in a Territory or possession, and
2.	Where a maximum price regulation, price schedule or order applicable in the Territory or possession establishes maximum prices for the sale of the commodity to the purchaser at a price lower than that permitted by the Export Regulation.
4.	Q. If any of the two elements listed above are not present, does Amendment 2 restrict the operation of the Export Regulation?
A. No.
5.	Q. For the purposes of this Amendment when is a sale said to have taken place in a Territory or possession?
A. The sales law applicable in each jurisdiction will govern. If, however, title passes and delivery is completed in the continental United States, the sale will not be considered a sale in a Territory or possession.
6.	Q. If the exporter receives payment in the continental United States and in accordance with instructions received from the buyer delivers the goods to a carrier as agent for the buyer, will the sale be considered to be a sale in the continental United States?
A. Yes. In this case, the delivery is completed when the exporter puts them on the carrier. In determining whether or not there is a sale in a Territory or
possession, the following aspects of each transaction must be examined: Delivery, risk of loss, place, and method of payment, passage of title.
7.	Q. Will the effect of Amendment 2 be such as to require exporters to the Territories and possessions to be familiar with all maximum price regulations, price schedules and orders applicable in the Territories and possessions?
A. As a general rule, no. Exporters who deliver to carriers in the continental United States and thereby discharge all their obligations are governed by the Export Regulation exclusively. If, however, the exporter has an outlet in a Territory or possession or actually makes a sale in a Territory or possession to a purchaser in the Territory or possession, his maximum price may be no higher than that established by any maximum price regulation, price schedule or order applicable in the Territory or possession.
8.	Q. Are sales by agents or subsidiaries of exporters when made in the Territories or possessions to buyers in the Territories or possessions subject to the Export Regulation if there is an applicable Territorial regulation?
A. No.
9.	Q. Is a merchant or other seller in the Territories or possessions entitled to charge an amount above what he paid for the commodity he is selling merely because his purchase price was in accord with the Export Regulation?
A. No.
Part XII—Records (Section 10)
1.	Q. Must an exporter keep any records under the Maximum Export Price Regulation?
A. Yes; according to section 10 (b) and (c)—regardless of whether or not the exporter has previously kept such records.
2.	Q. Is there any particular form of record-keeping that is required?
A. No; so long as the records kept contain the information required by the regulation.
3.	Q. Must an item-by-item breakdown of an order involving a large number of different units be made and kept by the exporter?
A. Records kept by the exporter must contain such a break-down. As a practical matter, much of the information on individual items will be contained in the invoice.
U. S. GOVERNMENT PRINTING OFFICE: 1943